LatAm Bonds

Moody’s expressed concern this week about the strength of investor protection afforded by some change of control covenants.

Benign conditions continued in the bond markets this week and investors flush with cash showed their appetite for new issuance across the board, ensuring most deals enjoyed dazzling levels of subscription and strong secondary performance.

Red-hot secondary markets and the scarcity of Latin American corporate bond issuance provided dream conditions for the few borrowers printing deals this week.

Risk appetite is in rude health among emerging market bond investors, just six weeks after the stockmarket correction that led to a temporary cooling of demand.

Despite the long weekend, bond market participants failed to come back with renewed energy this week and the primary market endured one of its most sluggish weeks since the beginning of the year. However, this lack of primary activity was compensated by the usual sieving through central banks’ statements.

The European Investment Bank priced a P320m (Eu39.5m) one year Botswanan pula bond this week. It is the first transaction in the currency since January 2006 and the success of the deal confirmed investors’ appetite for the currency.