Category: Argentina

A recent poll in Argentina has found that President Nestor Kirchner is currently enjoying an approval rating of almost 60%. Consultancy firm Analogías surveyed 1,200 people and recorded that 59.2% of them would reelect Kirchner if a vote were called today; 12.3% were undecided. When asked, almost 69% of those polled also said they would favor a Bolivian-style nationalization of Argentina’s energy assets.

Pan American Energy, Argentina’s second-largest energy producer, is to tap the markets for a series of negotiable bonds for up to $250 million. The 10-year paper will be traded via the Buenos Aires Stock Exchange and the London Stock Exchange. Pan American Energy is jointly owned by British Petroleum (60%) and local company Bridas (40%).

Argentina continues its remarkable run of growth, recording economic expansion of 8.6% for the first quarter of the year, compared with the same period in 2005, according to the national institution of statistics (INDEC). GDP expanded 7.7% in March compared with the previous year, driven by construction, automotive industry and durable goods. The economy has now grown for 40 consecutive months.

Venezuela has bought a further $200 million of Argentina’s dollar-denominated Boden 2012 bonds. The sovereign had originally been expected to offer another tranche of its new Bonar V paper to the open market but rising yields led it to choose the easy route and sell Boden directly to Venezuela. Venezuela now holds $1.3 billion of the instrument.

Argentina’s largest mortgage lender, Banco Hipotecario, has bought back $156 million worth of its bonds, denominated in US dollars and euros. Last month it sold $250 million of 10-year bonds to yield 9.75%.

The statement by Repsol YPF’s chairman, Antonio Brufau, that the company is considering floating between 15% and 20% of its Argentine business on the local stock exchange has stirred up rumors of strategy and motives among market commentators. The Spanish-Argentine oil giant moved swiftly to deny on its website that it had “received any indication from the Argentine government … that it is supposedly acquiring 51% of YPF’s capital.” It also made clear that the company would “maintain a clear majority stake in YPF” and that the sale of its capital in the company, under optimal conditions, would be aimed at private investors.

Argentina is to increase its minimum pension by 20% and all other pensions by 11%, adding around $1 billion to its annual pension bill. As from June 1, the monthly pension will rise from around $127 to $154. This is the eighth time President Nestór Kirchner’s government has increased pensions in the past three years and analysts are worried the rise will spur inflation.

New York’s Court of Appeals will today decide the fate of $105 million of assets belonging to Argentina’s Central Bank, frozen since January when some of the country’s creditors brought a case against the sovereign in the New York Courts after Argentina announced it was to repay its entire IMF debt early, using foreign reserves to help do so. The New York Courts originally ruled in favor of Argentina but the assets, held in the New York Federal Reserve, were placed under embargo and the case was referred to the Appeal Courts after investor groups EM and NML Capital appealed the decision.

According to local press reports, Argentina is considering issue a 10-year bond in the second quarter of this year. The success of its recent dollar-denominated Bonar V sale last week, which was four times oversubscribed, and the high liquidity in the international markets, have prompted the sovereign to consider the bond issue to help towards raising the $1 billion needed to meet financing needs this year.

Jorge Brito, director of Argentine Banco Macro, has been reelected president of the Association of Private Banks of Argentina (ADEBA). He will serve another two years until 2008. ADEBA comprises 27 local banks, which represent 30% of the assets in the private banking system.