A planned $20 billion bailout for Argentina from JPMorgan Chase, Bank of America and Citigroup has been shelved as bankers pivot instead to a smaller, short-term loan package.

The US Treasury reached a $20 billion exchange-rate stabilization agreement with Argentina, to be paired with a bank-led debt facility for the same amount. The deal came just days ahead of a midterm election that was crucial for Argentina's libertarian president, Javier Milei.

Bankers now say the debt facility is no longer under serious consideration, the Wall Street Journal reported, according to reports. Instead, lenders are planning to loan Argentina around $5 billion through a short-term repurchase, or "repo," facility, it said.

JPMorgan CEO Jamie Dimon says, earlier this month a potential loan from the banks to Argentina "may not be necessary," but the lender could be open to extending the nation's special financing.

The Wall Street Journal says that the funds would go toward a roughly $4 billion debt payment due in January, adding that talks were still in initial stages and could change or fall through.

US President Donald Trump and Treasury Secretary Scott Bessent have been staunch backers of Milei.

While Milei's administration has steadily brought inflation down from triple-digit year-over-year rises, reserves are tight and the government was quickly burning through dollars before the US backing.

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President Donald Trump’s administration had sought to support the Argentinian economy, offering a lifeline in a bid to support Argentine President Javier Milei.

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The deal included a currency swap line for $20 billion with the US Treasury and a separate facility for $20 billion that would be financed by banks and other institutions.

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Milei’s party scored a resounding win in crucial midterm elections earlier this year. After the victory, JPMorgan Chief Executive Officer Jamie Dimon says that the $20 billion in financing “may not be necessary.” He says that if the country needed special financing, the private sector was “all ears.”