Colombia Plans Swaps for Multilateral Debt

Colombia’s finance ministry is looking to take advantage of favorable exchange rates by swapping dollar debt into peso liabilities, starting with up to $2bn in multilateral debt. The government has a 6-month window in which it can enter into cross-currency swaps on certain issues of debt totaling $2bn, Maria Catalina Escobar, head of external capital markets at Colombia’s finance and public credit ministry, tells LatinFinance. The specific debt issues to be swapped will be announced imminently, and the timing and total amount will be at the government’s discretion. Escobar explains that the banks involved, which could include Colombian institutions in addition to the usual international counterparties, will be chosen in an open bidding process at the time of the individual transactions. Colombia’s total dollar debt stands at about $20bn, according to the ministry. The government is not planning to raise any new debt this year, says Escobar.