Panama Fund to Sell More Bonds

Panama’s government-backed Fondo Fiduciario para el Desarrollo (FFD) is preparing to offer $89.5m in existing 7.125% 2026 sovereign bonds this week, says Diego Ferrer, Panama’s sub-director for public credit at Panama’s ministry of economy and finance. “Conditions in the market have been volatile, but Panamanian bonds have rallied, giving us a window to make a very attractive capital gain,” he says. The 7.125% global 2026s have been trading at 128-129 or at 4.45% on a yield basis. The ministry says while it is negotiating a price, it finds the 126-128 range attractive. The global bonds will be sold to Morgan Stanley, the underwriter, which will in turn sell the bonds to the public on a variable price reoffer basis at a later date. Panama filed with the SEC Wednesday and expects to close the transaction on Friday. The FFD was established in 1995 with the goal of providing financing for public sector projects.