The Central American Bank for Economic Integration (Cabei) has issued its first local currency-denominated bonds in a Latin American market, with a 460 billion Colombian peso offering ($203 million). The bonds, which mature 15 September 2015 were issued with an interest rate equivalent to inflation plus 2.3%. The multilateral issuer, rated A2 by Moody’s, has been looking to issue in the region to take advantage of the favorable market conditions and good investor appetite.
Category: Bonds
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DR-CAFTA accord becomes topic of discussion
DR-CAFTA accord becomes topic of discussion during the upcoming Dominican Republic-Central America Forum; which will examine the extent to which the DR-CAFTA accord is accelerating the integration of the Dominican Republic and Central America into a new economic region and financial market. Speakers will also examine how regional political and economical changes will affect development, finance, investment and trade in the region. Topics will be discussed by Temístocles Montás, Presidential Technical Secretary, Dominican Republic; Roberto Zamora, President, Grupo LAFISE; Rafael Menicucci, President, Cervecería Nacional Dominicana; Marvin Taylor, BCIE, Chief Economist; Luis Armando Montenegro, Banking Superintendent, El Salvador. The inaugural Dominican Republic-Central America Forum will take place on March 9th in Santo Domingo. To learn more please visit http://www.latinfinance.com/default.asp?Page=3&ISS=20912&SID=596478
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IDB To Launch Mexican-denominated Paper
The Inter-American Development Bank (IDB) is planning to issue global bonds denominated in Mexican pesos. The amount to be issued is reported to be equivalent to around $240 million. The last time the IDB issued peso-denominated paper was last October when it sold Ps1 billion ($93 million) of 10-year securities offering a rate of 8.67%. In 1994 the bank became the first international issuer to launch a global bond denominated in Mexican pesos. The upcoming deal will be arranged by Credit Suisse.
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Ecuador To Buy Back Up To $650 Million Debt
Ecuador is to buy back between $400 million and $650 million, or just over five years’ worth, of its global 2012 bond by May next year (it is obliged under its default terms to repurchase at least $125 million every year from 2006). The sovereign wants to lower its debt financing costs and the interest rates on the 2012 are proving costly. If it does buy back $650 million of the bonds, it will save itself $17 million over the next five years. Ecuador will finance the buyback using part of the money raised from its recent international bond issuance together with a loan of $400 million from the Latin American Reserve Fund (FLAR). The government has so far used $257 million of the $650 million raised from the international issuance to make domestic and external debt payments.
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Infrastructure Ratings Agency For Mexico
The US and Mexico have said they are keen to see an infrastructure ratings agency established to rate large building projects in Mexico. The agency could potentially be set up with support from the IDB and would improve information for investors and help increase flows of capital to the country’s infrastructure projects. Following a meeting last week, US Treasury Secretary John Snow and Mexican Finance Minister Francisco Gil said they would like to see a multilateral agency set up to help foster infrastructure development and speed Mexico’s economic growth.
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$350 Million Multilateral Loans To Peru
Peru is to receive $350 million of multilateral loans after the World Bank and the IDB approved credits of $150 million and $200 million, respectively. The World Bank loan is aimed at helping the government to decentralize public services; the IDB loan is directed at supporting government efforts to increase investment and setting up joint ventures with the private sector.
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Ecuador May Sell More Bonds; Will Buy Back $250 Million Debt
Following the success of its return to the international debt capital markets on Wednesday when it sold $650 million 10-year bonds, Ecuador is considering a further bond issuance. The sovereign said its offering was twice oversubscribed. As planned, Ecuador will use the funds to buy back $250 million, or two years’ worth, of its global 2012 bond (it is obliged under its default terms to repurchase at least $125 million every year from next year). It also plans to used the money raised to help buy back $600 million of local short-term debt to aid liquidity.
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Mexico IPAB To Buy Back 10 Billion Pesos Bonds
IPAB, The Institute for the Protection of Bank Savings, in Mexico is planning to buy back up 10 billion pesos ($955 million) before month-end. IPAB is looking to extend out its debt profile by lowering the amount of debt maturing in the second half of next year.
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Ecuador To Buy Back Global Bonds
Ecuador is planning to buy back some of its global 2012 bonds with some of the money it raises from a forthcoming sovereign debt issue. As part of the most recent renegotiation of its external debt, the sovereign must buy back at least 10% of the $1.250 billion global 2012 bonds outstanding.
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Brazil Cosan IPO Suspended
Brazil’s securities market regulator, CVM, has issued a two-week suspension of the flotation of the country’s largest sugar and ethanol producer, Cosan SA, citing a violation of the “quiet period”. This period forbids a company from making a public statement regarding its offering. Cosan’s shares were due to be listed on Bovespa this Thursday. The IPO is aimed at local and foreign investors. The offer is being arranged by Morgan Stanley.