LatAm Bonds

DCM bankers covering Brazil are hopeful that liability management exercises from financial institutions may provide them with something to do in the coming weeks as the new issue market suffers depressed volumes.

Latin America’s bond bankers are contending with shrinking fees, while bond volumes in the region have hit their lowest year to date volume ebb since 2009.

Troubled Brazilian shopping centre owner General Shopping Brasil has launched a heavily discounted tender of its 10% senior perpetual notes in an effort to reduce its dollar debt, although Fitch says that a debt restructuring is “likely to occur in the near future”.

The issuer formerly known as Pacific Rubiales fell just one notch away from triple-C status on Wednesday after Moody’s downgraded the borrower by three notches from Ba3 to B3 and kept it on negative outlook.

It seems that Latin America bond fees are going the way of CEEMEA — small to the point of non-existent for some issuers — and that is a frightening prospect. But it is better that banks accept and plan for that now rather than rage against the dying of the wallet.

Banco do Estado do Rio Grande do Sul (Banrisul) has become the third Brazilian lender to launch a tender offer for existing debt as bond prices in the country hit lows.

It seems that Latin America bond fees are going the way of CEEMEA — small to the point of non-existent for some issuers — and that is a frightening prospect. But it is better that banks accept and plan for that now rather than rage against the dying of the wallet.

Latin America’s bond bankers are contending with shrinking fees while bond volumes in the region have hit their lowest year to date volume ebb since 2009.

The Argentine province of Neuquen is planning to test high yield appetite in Lat Am with a $350m international bond that will boast the provinces royalties from gas production as collateral.

The entity that has managed the Panama Canal since the US relinquished control in 1999 will meet fixed income investors in the next week ahead of a planned bond market debut.

The downgrade of Brazil by Standard & Poor’s into sub-investment grade territory on Wednesday had been seen as inevitable for nearly two months. But when it came, the downgrade was as brutal as it could have been.

The two Fibras — or Mexican Reits (real estate investment trusts) — lining up to issue are perfect candidates for the volatile conditions in the Latin American market, said LatAm bond bankers.