LatAm Bonds

Two Latin American borrowers will test new issue conditions next week in a bond market that DCM officials said is showing signs of “correcting itself” after a prolonged rally.

Holders of Argentina’s exchange bonds did not receive $539m of interest payments due to them by midnight on Wednesday, leading S&P and the New York court appointed mediator to proclaim a default — a that the sovereign declines to describe as such. But as the clock hit midnight in New York little more was clear as to the future of the continuing debt saga.

Throughout its default saga, Argentina lived up to the pantomime villain role in which many financial commentators paint it. From a refusal to meet the holdouts to emotive statements throwing blame all over, Argentina is an easy target for analysts — especially those in the US.

Argentina’s debt saga as the stage for some of the best theatre of the absurd ever seen in finance culminated this week in an apparent breakdown in communication that caused the nation’s assets to rally wickedly in the hours leading up to a default.

Argentina’s economy minister Axel Kicillof arrived in New York on Tuesday to join finance minister Pablo López at talks with mediator Daniel Pollack in what one investor in Argentine bonds said was a “surprising last development” but a “positive sign”. Meanwhile, Argentina's private banks may be about to step in to help resolve the situation.

Colombian infrastructure development bank Findeter (Financiera de Desarrollo Territorial) will begin a roadshow on Thursday more than 18 months after it told GlobalCapital it was planning its debut international bond issue.

Colombia completed a clean sweep of mid triple B ratings as Moody’s on Monday followed the actions of its peers in 2013 in promoting the South American sovereign to Baa2.

Azucena Arbeleche resigned from her position of director of Uruguay’s debt management unit on Monday for personal reasons, she said in an emailed message.

Paraguay (Ba2/BB/BB-) will begin fixed income investor meetings on Tuesday as it plans its second ever international bond issue to finance infrastructure and energy projects.

Chilean natural gas terminal operator GNL Quintero (GNLQ) priced its debut 144A/Reg S dollar bond on Thursday, attracting a large order and pricing at the tight end of what observers considered fair value as benign conditions continue to attract LatAm borrowers.

Latin America debt bankers praised Brazil for its “uncanny” knack for timing markets after the borrower became the latest Latin American borrower this year to raise 30 year money to buy back old bonds as the US Treasury long bond hit its tightest level for a year.

Some investors and analysts are predicting that Argentina will enter technical default on July 30 after US district court judge Thomas Griesa on Tuesday declined to grant the country a stay of execution on his decision to force the sovereign to pay holdout bond investors in full.