Central America

Mexican lender Banco Mercantil del Norte (Banorte) is looking to sell its third Swiss franc bond, breaking a two-week hiatus in cross-border issuance from Latin American borrowers.

Mexican leasing company Unifin issued $200m of three year debt via a private placement this week on the back of reverse inquiry from an institutional investor.

As Latin American bonds suffer from broader market volatility, potentially closing the primary market window to riskier names, Fitch said on Monday that Mexico’s budget would be strained in the face of weak growth and lower oil revenues.

Swiss firm responsAbility Investments has closed a $175m microfinance CLO via JP Morgan, revitalising an industry which last saw issuance before the financial crisis.

A senior secured bond from Brazilian MV24 Capital performed well on the break on Friday, shrugging off global market concerns, with new issuance from Latin America likely to be limited in the next few weeks.

Central American sovereign El Salvador saw its first long bond in eight years tighten in secondary as investors gave new president Nayib Bukele a warm welcome this week.

Scarcity value for long dated high yield paper and expectations of curve flattening helped El Salvador sell more than $1bn of 30 year paper in a highly oversubscribed deal on Tuesday amid strong bond markets.

Latin American new issue volumes are rapidly catching up with last year’s totals and bond bankers expect some activity to continue during the usually quiet August period as borrower-friendly conditions endure.

Mexico responded to the lower rates environment on Tuesday with an opportunistic $3.56bn liability management exercise, shrugging off any credit worries to issue at a very slim concession.

Mexico showed that even trickier credit stories could take advantage of the borrower-friendly rates environment, surprising many with a $3bn liability management exercise just two weeks after finance minister Carlos Urzúa resigned.

Central American sovereign El Salvador will begin meeting bond investors on Wednesday as it looks to issue its first international bond under president Nayib Bukele.

Debt capital markets bankers say more Mexican companies could rush to bond markets, as strong conditions for issuance outweigh the increasing concerns surrounding the direction of the country's economy.