Latin America

After nearly two months of persuasion, Mexican petrochemicals company Grupo Idesa received the approval of its bondholders to push out some $300m of international bonds by six years and give major relief to its liquidity situation.

Argentina is set to enter default on its international debt for the ninth time on Friday, but the sovereign curve performed well this week as investors and analysts say that creditors will continue negotiations well after the grace period on $503m of coupon payments expires.

Investors say that bond markets are wide open for many Brazilian companies, but even as access to credit has suddenly become a major topic for the country's corporate executives, most of the cash-rich companies they run are shying away from international markets and betting that they will be able to achieve better borrowing terms in the future than are on offer today.

Ecuador could take useful clues from Argentina’s debt restructuring, said analysts, as it prepares to present an offer to its bondholders having taken decisive economic measures in the past week.

Only in Argentina could a finance minister claim that default on billions of dollars of bonds constitutes merely an “anecdotal date”.

A supranational and a Nordic bank paid rare visits to the Swiss franc market this week. The North American Development Bank (NADB) printed its first deal in two years — its second green bond — while Nordea returned after a five year absence.

Isaac Deutsch, who led Sumitomo Mitsui Banking Corporation's Americas specialized finance division between 2012 and 2018 before becoming the firm's deputy Americas CEO, is said to have departed from the bank earlier this week.

As bondholders eagerly await details of a rescue package from Brazilian development lender BNDES to the three largest airlines operating in the country, the strongest credit in the sector coming into the Covid-19 crisis is now the perceived as the weakest.

Decisive economic measures from Ecuador’s government could help curry favour with bondholders ahead of a debt restructuring, said analysts, as Argentina provided an ideal template of what not to do.

The president of Grupo Energía de Bogotá (GEB) told GlobalCapital that the issuer’s faith in demand for its bonds had allowed it to tighten pricing sharply on its long-awaited return to bond markets last week, as the company waits for an improvement in domestic market conditions to continue its capital markets activity.

Analysts expect negotiations between Argentina and its foreign bondholders to continue past May 22, the date that the sovereign could enter default, with restructuring proposals from the creditors implying recovery values up to 50% higher than what the issuer initially proposed. But as both parties appear to be keen to find a solution, the bonds continued their rally on Monday.

Latin American development bank Corporación Andina de Fomento (CAF) began investor calls on Monday as it looks to sell a benchmark-sized euro denominated social bond to help fund its response to the Covid-19 pandemic.