The Brazilian government plans to buy back foreign currency bonds it considers the market is valuing too cheaply. Treasury officials are eyeing bonds maturing in 2020 and 2030 because yields on these issues are higher than other outstanding debt, distorting the sovereign yield curve.
Category: Bonds
Posted inDaily Brief
Submarino To Buy Back Shares
Brazilian internet retailer Submarino is to buy back up to 10% of its stock, comprising around 5.13 million shares. The shares closed the day Tuesday at $15.36. The buyback is being coordinated by Credit Suisse, Banco Santander, Banco Itaú and Banco Pactual.
Posted inDaily Brief
CAF Keeps Them Coming
Andean Development Corporation (CAF), the Caracas-based regional multilateral financial institution, is to follow up its landmark local-currency issue in Peru last month with an offering in Venezuelan bolivares. The Corporation is looking to place $100 million worth of local-currency bonds in Venezuela on June 13. The bolivar-denominated debt would be the first such paper to be issued by a multilateral in Venezuela. The five-year floating-rate bonds are expected to yield around 7%. Last month CAF successfully placed $75 million worth of 12-year local-currency bonds in Peru, the Corporation’s first bond issue in new soles and the largest such offering by a non-government issuer in the local market.
Posted inDaily Brief
Panama To Buy Back Bradies
Panama is to buy back all its outstanding Brady bonds next month, taking advantage of a call option on July 17. The $352 million bonds in circulation comprise four series. Panama is following a now, well-trodden path in the region to improve its debt profile. Earlier this year Brazil announced its multi-billion dollar Brady buyback plan; Venezuela was due to buy back $3.9 billion of Bradies by the end of last month and Colombia announced it would spend $4.3 billion on repurchasing the paper this year.
Posted inDaily Brief
Ecuador To Buy Back Outstanding 2012s
Ecuador is to buy back its outstanding 2012 bonds by January, ahead of the new government assuming power. There are currently $510 million of the 2012 bonds, the sovereign’s most expensive debt, in circulation. Last month the government bought back $740 million of the 12% bonds to save an estimated $20 million a year in debt payments. Ecuador is likely to tap the international bond market later this year; the government has been authorized to issue up to $900 million of new debt.
Posted inMagazine
Venezuelan Vital Stats
CAF’s $100 million bolivar bond issue in Venezuela brings some much-needed variety to local investors, and hopefully some vitality for the long-stale market as well.
Posted inDaily Brief
CAF Signs $80 Million Panama Loan
The Caracas-based Andean Development Bank (CAF) has signed at $80 million loan to Panama to be directed at improving and upgrading highways within the country, including the interoceanic route that runs parallel to the canal. Panama is contributing $45 million to the project.
Posted inDaily Brief
Guatemala Delays CAFTA Implementation
The implementation of Guatemala’s free trade agreement with the US (CAFTA), which should have come into effect on May 1, has been delayed due to a lack of consensus in Congress. Guatemala’s president, Oscar Berger, a champion of the agreement, has called the delay a “tragedy.”
Posted inDaily Brief
Colombia Central Bank Makes Surprise Rate Hike
In a move that surprised the markets, Colombia’s Central Bank raised the benchmark lending rate Friday by a quarter of a percentage point to 6.25%. The Bank chose to preempt inflationary pressures by raising the rate for the first time since April 2003. The move is also seen by the market as a demonstration of the Bank’s independence, coming as it does just ahead of presidential elections in May and just after comments by President Uribe that he didn’t want to see any rises in interest rates.
Posted inMagazine
Indexing Across Borders
Jamie Nicholson-Leener, head of Latin American corporate credit research at Credit Suisse, explains why her investment bank developed its Latin America Corporate Bond Index.