Latin America

Colombia’s sovereign bonds experienced a modest sell-off on Friday after Fitch become the second rating agency in less than two months to downgrade the government’s credit rating to sub-investment grade. But analysts noted that the market was already largely expecting the downgrade, which is likely to limit further widening.

Brazilian bank BTG Pactual added $250m to its January 2025 notes on Thursday, targeting retail investors as it sought to raise shorter dated funding than on its last bond market outing at the start of the year.

The Bank of Nova Scotia’s Chilean subsidiary turned to the Swiss franc for its debut international bond sale on Tuesday, achieving a cost of funding well inside what it could have achieved in the domestic market.

Chile turned to international investors for the fifth time this year on Wednesday — and the first time in local currency — to sell over $2bn-equivalent of social bonds, with foreign buyers taking nearly half the deal.

Brazilian financial name BTG Pactual is set to price a tap of its 4.5% senior unsecured January 2025s on Thursday, with bankers expecting the bank’s strong recent performance to outweigh a market starting to show signs of new issue fatigue after a busy June.

Brazil sold $2.25bn of dollar bonds across two tranches on Tuesday, taking advantage of a strong primary market window that is leaving some bond buyers underwhelmed with pricing.

Suzano, the Brazilian pulp and paper producer that last year became the second company in the world to sell a sustainability-linked bond (SLB), returned to capital markets on Monday with a $1bn long 10 year deal that has a coupon linked to different key performance indicators from its first deal.

Peruvian power generation company Orazul has launched a tender offer for a portion of its 2027 bonds and will use proceeds from last year’s sale of its transmission businesses to fund the liability management. Fitch had anticipated the prepayment of the notes back in August 2020, when it placed Orazul’s credit rating on positive watch.

Brazilian financial services firm XP opted for a five year maturity on its debut bond issue on Thursday, attracting $1.7bn of orders on the way to a $750m trade.

The Argentine province of Chaco wrapped up a debt restructuring on Thursday after more than 90% of its bondholders agreed to push out the maturity and reduce the coupon of its $250m 2024s. But the Province of Buenos Aires continued to frustrate bondholders, who said negotiations have stalled more than a year after the country’s largest regional government defaulted.

Glarner Kantonalbank dipped into the tier two market this week to raise an index eligible bond that may fund the redemption of the additional tier one (AT1) the bank rolled over in December due to coronavirus volatility. GLKB was joined on screens by a flurry of financial activity out of Chile.

Panama sold $2bn of bonds across two tranches on Wednesday, including a $1.25bn 10 year local bond that was priced over 85bp wide of its global curve. Most observers thought it was an attractive pick-up for investors.