Bankers Counting on DCM Pickup

LatAm DCM volume has slowed somewhat following a record first quarter, but bankers are hopeful that issuance will pick up as expected mandates are awarded and issuers emerge from recent quiet periods. Following transactions last week from Ajecorp ($300m) and Banca Mifel ($150m), few deals appear to be in the pipeline, but more mandates and requests for proposals are expected to emerge over the next month, bankers say. “It feels a little slow, but I do think in the next 3-4 weeks we will see 3-4 RFPs,” says a New York DCM banker with a few deals already in the pipeline. Through last week, LatAm borrowers had issued $48.2bn in cross-border bonds from 77 deals this year, according to Dealogic, up from $41.1bn from 76 deals in the corresponding period in 2011. While supply has been quiet in the LatAm space compared with Asia and Europe, investor appetite remains alive across all regions. “Books have been oversubscribed in other regions and deals have performed OK in the secondary, but the reason why Latin America has been quiet is because there is less refinancing need than in other regions in general and [recent] LatAm deals have been opportunistic,” says a London-based EM portfolio manager. Despite low LatAm supply as of late, investors have remained selective on deals in the bond market, especially with LatAm high-yield debutants. “We have seen a few deals cancelled, and risk rewards are [closely monitored] especially in the high-yield space,” the investor adds. Inmet Mining is meeting with investors in the US and Europe ahead of a $1bn bond sale to fund the development of the Cobre Panama copper project. The B1/BB minus Canadian-based global miner expects to price the 2020 NC4 Tuesday. Citi, Credit Suisse, BAML, Morgan Stanley and RBC are managing the transaction. Guatemala’s G&T Continental is heard to have selected banks for a dollar bond transaction and UMS is heard sounding out accounts in Japan for a JPY bond without a JBIC guarantee. Though still on a record p