In 1872, Paraguay was trying to recover from a devastating war, after which Brazil and Argentina seized much of its territory, and reduced its population to one-third of what it was before the war. However, Paraguay raised loans in London in 1871 and 1872. The 1872 loan was a disaster. Although offered at 85%, only £ 562.500 was subscribed, of the £ 2.000.000 on offer. Both these two loans were in default from 1874.