Argentine Congress votes in favor of law to pay debts through local bank system

Argentina's Congress has approved a bill to restructure the country's debt and sidestep a U.S. ruling that recently pushed it into default.

The lower house of Congress voted in favor of the bill early Thursday. It had already passed the Senate.

The measure would let Argentina's government pay bondholders locally to skirt the U.S. financial system, which is bound by a U.S. court order restricting Argentina's repayments.

Argentina settled most of its debt with creditors after its 2001 default by trading lower-value bonds for defaulted debt. But a group of holdouts refused to accept that deal and continues to seek about $1.5 billion.

A U.S district judge ruled Argentina could not pay the other creditors until it settled with the holdouts, triggering the country's second default in 13 years.