Standard & Poor’s declared Argentina to be in default of some of its debt on Wednesday after the country failed to reach a bond payment deal with a group of creditors before a court-imposed deadline.

Wednesday marked the end of a 30-day grace period Argentina had to make a scheduled $539 million interest payment to a group of bondholders that was due June 30. The country had been holding last-minute negotiations with the creditors and a court-appointed debt mediator in hopes of reaching a resolution before the deadline passed.

The mediator, McCarter & English attorney Daniel Pollack, said in a statement that, because an agreement could not be reached, Argentina “will imminently be in default.”

This is Argentina’s second default in 13 years after it stopped making payments on $100 billion of debt in 2001, setting off a financial crisis in the South American country and severely wounding some its lenders. This latest default is expected to have a far less severe economic consequences because Argentina, although in recession, is now more economically stable.

The debt payments now in question date back to the 2001 crisis, after which Argentina brokered deal to pay most of its creditors less than they were owed. A handful of creditors –led by hedge funds Elliot Management unit NML Capital and Aurelius Capital Management – refused that deal and are still trying to collect the full amount.

These holdout creditors had previously sued Argentina in the U.S., winning a decision in federal court in 2012 to force payment on the old bonds while ensuring that Argentina continued to pay off the others with which it had struck a deal. The country appealed the decision all the way to the U.S. Supreme Court, which, last month, refused to hear the case.

The mediator, Pollack, added: “Default is not a mere ‘technical’ condition, but rather a real and painful event that will hurt real people: these include all ordinary Argentine citizens, the exchange bondholders (who will not receive their interest ) and the holdouts (who will not receive payment of the judgments they obtained in court).”

Speaking to reporters after the negotiations ended, Argentine Economy Minister Axel Kicillof said his country refused to reach a deal under “extortion” with a group of bondholders he called “vulture funds,” according to Bloomberg.