Uruguay Schedules Local Issue, Eyes USD

Uruguay is planning to issue up to $300m in dollar denominated 10 year bonds aimed at the domestic retail investor base. Starting in April or May, the sovereign aims to sell $5m-$6m a week, Uruguay’s head of public credit Carlos Steneri tells LatinFinance. He expects to pay roughly the same as the sovereign’s foreign bonds yield for the same tenor, around 8.00%-8.25%. A deal is ready to go, but it awaits final documentation from the central bank. The sovereign is prefinanced through Q1 2010 and recently secured $600m from CAF and the World Bank, so it is no hurry to issue. Nonetheless, Steneri says Uruguay will also try and issue a $500m 10-year global bond later in 2009. But the country is in no hurry. “The carry is very expensive,” says Steneri. He adds that the sovereign is always open to liability management ideas, but current volatility makes it unattractive. In macro terms, Steneri says Uruguay is doing better than expected through the crisis. He adds that the economy is much less exposed to Argentina than in 2001, and expects resilience even if Buenos Aires gets into funding difficulties again.