UPDATE 3-Regulators enter Citibank Argentina building as debt fight heats up
(Adds Argentina's appeal to U.S. court)
By Hugh Bronstein
BUENOS AIRES, April 6 (Reuters) - Argentine central bank regulators entered Citibank Argentina's headquarters on Monday, as the battle intensified between the government and a group of U.S. hedge funds that refuse to accept discounted payment terms on the country's defaulted debt.
Argentina's securities regulator says Citibank Argentina violated local laws by striking a deal with the hedge funds. It has suspended Citibank Argentina from conducting capital market operations and stripped its CEO's authority.
"There will be an inspection of Citibank Argentina today to ensure it is functioning," a central bank spokesman said. The regulators' task will be to monitor operations, not take over management of the bank, he said.
Four inspectors wearing central bank lapel pins were later seen entering the bank's headquarters in Buenos Aires.
A spokesman for Citigroup, Citibank Argentina's parent group, had no comment on the situation.
Argentina on Monday appealed a U.S. federal court order that it said "erroneously modified and extended" a ruling preventing payment on its restructured bonds under Argentine law.
The order led to Argentina failing to complete an interest payment on local law bonds for the first time since it tipped back into default in July. Continuación...