LatAm Bonds

BBVA has hired a former deputy director from the Spanish Treasury to look after funding and balance sheet management for its South American subsidiaries.

Bond investors gave an emphatic thumbs up to Mexico’s plans for its state oil company Pemex on Wednesday, piling into the borrower’s first bond of the year, a $4bn triple-tranche issue that attracted $30bn of demand.

Peruvian miner Hochschild became the first debut borrower of 2014 in Latin American bond markets with a $350m seven year issue on Wednesday. But despite a strong book of nearly $1.5bn bankers say the pace of new issuers from the country will slow this year.

Sovereign supply has dominated the CEEMEA market this week, with Latvia and Romania delivering landmark deals in euros and dollars respectively.

Investors representing 86% of Brazilian oil and gas services firm Lupatech’s bondholders have approved the company’s proposed debt restructuring, allowing the plan to be submitted for approval at an extraordinary general meeting and submitted to be homologated in court.

Development bank BNDES became the second state-owned Brazilian borrower to issue in euros in 2014 with a €650m transaction sold at a new issue premium as low as 5bp according to bankers close to the deal.

Mexican bottler Coca Cola Femsa (KOF) and the Commonwealth of the Bahamas provided evidence of strong new issue conditions as bankers expect new dollar supply to begin in earnest this week.

BNDES looked set to become the second Latin American name to tap the euro bond market this year after books opened on Monday morning on a new five year benchmark from the Brazilian borrower.

Recently upgraded Mexico will return to euros and Japanese yen to raise the next batches of its external funding after Thursday’s successful first outing of 2014 in dollars, according to the sovereign’s public credit director.

The Swiss franc bond market had its first taste of socially responsible investment bonds this week, with the European Investment Bank issuing a highly successful, long dated green bond, reports Nathan Collins. And where the EIB leads, other supranationals and agencies tend to follow, with bankers predicting more issuers likely to turn to Switzerland as a source of buyers for both SRI debt and duration.

This week’s landmark €3.8bn multi-trancher from Brazil’s Petrobras — the largest ever non-dollar bond from an emerging market country — underlines scope for euros to contribute a larger share of new EM debt issues in 2014, according to bankers. The common currency should even accommodate debuts from Latin America and other regions this year, they forecast.

Paraguay’s Banco Regional will begin a roadshow next week ahead of a potential debut international bond, with bond bankers expecting the market to be warmed up and ready for high yield issuance by the time the lender is ready to issue.