The Republic of Colombia returned to the international bond on Monday to raise $5.2 billion in its second multi-part offering this year, as financial services firm BAC Credomatic priced its first cross-border deal in over three years.
Colombia issued $2.2 billion worth of long five-year bonds, $2 billion in long 10-year notes and $1 billion in 30-year notes in an offering that was roughly 3.2 times oversubscribed, according to a source familiar with the deal.
The country priced 7% 2032 bonds at 99.799 to yield 7.05% after opening the initial price talk in the 7.35% area and setting guidance at around 7.1%. It sold the 7.625% 2037 notes at 99.842 to yield 7.65% after opening the bidding at around 7.9% and tightening to the 7.7% area, the source said.
It also priced 8.125% 2056 notes at 99.721 to yield 8.15% after initiating the bidding at around 8.45% and tightening to between 8.15% and 8.25%, the person added.
Investors placed as much as $11.2 billion in orders for the 2032s and 2037s, while demand for the 2056s reached $5.2 billion, according to the source. BBVA, Itaú BBA and JPMorgan acted as bookrunners on the offering.
The offering was Colombia’s first since Abelardo de la Espriella was elected president in June. It also follows his government’s announcement last week that it will enact the proposed 2027 budget by decree after lawmakers failed to approve the legislation in time.
The government said in a prospectus that it will use the proceeds of Monday’s sale to fund its budget deficit, which is expected to hit 7.2% of GDP this year, up from the 5.3% gap projected by the previous administration.
BAC RETURNS
BAC Credomatic, for its part, priced $500 million worth of five-year bonds, according to a source involved in the deal. It issued the 6.75% 2031 notes at 99.267 to yield 6.926%, or 210 basis points over US Treasury bonds, after opening the bidding in the 250 bps area and tightening the spread to around 215 bps.
Bank of America, JPMorgan and Santander were bookrunners on the deal.
The firm, which last issued cross-border bonds in January 2023, intends to use the proceeds to refinance local debt and boost its liquidity, according to Fitch and S&P, which both rated the notes BBB-.