BlackRock, Franklin Slash Holdings of Puerto Rico Utility Debt

BlackRock Financial Management and Franklin Adviserscut their exposure to Puerto Rico’s power utility bonds as the entity’s bankruptcy remains in limbo.

US District Court Judge Laura Taylor Swain has put the bankruptcy of Puerto Rico Electric Power Authority, also known as Prepa, on hold while a legal dispute over the makeup of the island’s financial oversight board plays out.

BlackRock slashed its holdings of the utility’s debt by a third and now has $438 million worth of bonds as of Oct. 6, according to court documents filed Thursday in the bankruptcy case. Franklin cut its holdings in half, ...