Stockton, Calif. city council approves plan to exit bankruptcy

Reuters

STOCKTON, Calif., Oct 3 (Reuters) - Stockton, California'scity council approved a plan on Thursday for the city to adjustits debt to exit from bankruptcy after reaching a deal with bondinsurer Assured Guaranty to restructure more than $150 millionof outstanding debt.

The deal marks the end of a long and often bitter fightbetween Stockton and its biggest bond insurers since the cityfiled for bankruptcy last year and stunned the U.S. municipaldebt market with threats of forcing losses on bondholders whileleaving pension payments intact.

"Now we have deals with every bond insurer that's involvedin the bankruptcy process," Stockton City Manager Bob Deis said,adding he is hopeful the city is on track to exit bankruptcy inabout six months.

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