The mediators who oversaw negotiations between Detroit and two banks to strike a deal to end a costly interest-rate swap agreement recommended yesterday that the judge in charge of Detroit's bankruptcy approve the agreement, arguing that the deal is a critical first step toward resolving the historic case, Reuters reported yesterday. The city struck a deal with UBS AG and Bank of America Corp's Merrill Lynch Capital Services on Dec. 24 to end the interest-rate swap agreements at a 43 percent discount. The negotiations happened after Bankruptcy Judge Steven Rhodes, who is overseeing the case, encouraged Detroit to negotiate better terms for the deal. Judge Rhodes still must approve the agreement and he will hold a hearing on Jan. 3 to consider the arrangement.
