LatAm Bonds

A quiet first quarter of FIG issuance from Latin America has drawn the region’s banks into a bond market that has delivered tightly priced bonds, said bankers. Santander Chile and Brazil’s BNDES benefited this week, with BNDES’s deal of particular encouragement to other Brazilian bank issuers, according to DCM bankers in the country.

The fastest book build one syndicate banker has ever seen helped Endesa Chile to a first international bond in nearly two decades on Thursday as a universal tightening in LatAm credit entices borrowers from the region into the market at a rapid rate.

Latin American issuers have been piling into the euro-denominated bond markets in unprecedented volumes this year, with Pemex the latest to take advantage of euro investors’ need for diversification and yield.

Uruguay-headquartered Navios South American Logistics returned to the capital markets on Tuesday and found strong demand among US high yield investors to price an eight year non call three bond to finance a liability management exercise.

The heat in the LatAm bond market crept up a notch after Brazil’s Gerdau captured a 12 times subscribed book for its latest bond on and Abengoa’s deal shot up a remarkable five points in secondary the day after pricing.

Mexican state-owned oil company Petróleos Mexicanos tightened pricing aggressively on its return to the euro market to clinch a €1bn 12 year at a new issue concession of zero, according to bankers on the deal.

Brazilian company Votorantim Cimentos has picked banks for a euro transaction and begins investor meetings across Europe on Thursday.

Petróleos Mexicanos opened books on a euro benchmark bond on Wednesday morning, after ending a four year absence from that currency late last year. The borrower is pushing out its euro curve with a 12 year bond to take advantage of the thirst among German and French investment grade accounts for longer dated, higher yield paper, said bankers on the bond.

A quiet first quarter of FIG issuance from Latin America has urged the region’s banks into a bond market that has delivered tightly priced bonds, said bankers. Santander Chile was the latest to benefit, selling a $500m three year FRN on Tuesday.

Uruguay-headquartered Navios South American Logistics and Peruvian Abengoa Transmisión Sur joined the ranks of Latin American borrowers taking advantage of strong issuance conditions in dollar markets with well-bid deals on Tuesday.

Countries and corporates are carrying CEEMEA supply, with benchmark prints from the Zambian and Turkish sovereigns the stand-out deals so far this week. Meanwhile, Latin America’s roaring start to the second quarter shows no signs of stopping, with issuers of all sizes and ratings taking advantage of stable base rates and a strong institutional bid.

A rally in bond markets and improved sentiment surrounding Brazilian assets helped BNDES to a well-subscribed $1.5bn dual tranche issue on Monday, with steel company Gerdau expected to bring more supply from the country this week.