South America

Investors should beware the surge in Brazilian equities that coincided with the election of its new president Jair Bolsonaro last year.

BTG Pactual has appointed Brazil’s most recent finance minister to become CEO of its asset management business following the hire of a BlackRock veteran to lead its equities business.

Dutch asset manager NN Investment Partners will open a new office in Montevideo, Uruguay on February 25 to service Latin American and US offshore clients, the company said on Friday.

BTG Pactual’s new tier two bonds, the only new issue from Latin America this week, traded pretty much in line with reoffer in the days following pricing, suggesting leads had done a reasonable job of price discovery.

Brazilian lender BTG Pactual was the sole Latin American borrower to venture into dollar markets this week as some syndicate bankers began to worry that the region’s issuers are missing the best of conditions.

Chilean copper miner Codelco looks unlikely to be able to repurchase the $1.907bn of bonds that it was hoping to cancel via a tender offer after investors holding just over half of that amount agreed to sell their paper after the early-bird period expired.

Though a paucity of direct comparable bonds made it difficult to precisely judge the pricing on BTG Pactual’s tier two deal on Tuesday, DCM bankers said that the Brazilian lender had shown investors were willing to bet on high yield paper but keep discipline on price.

Brazilian bank BTG Pactual will look to price a 10 year non-call five subordinated tier two note on Tuesday after wrapping up investor meetings in Asia on Monday.

Bolivia-headquartered multilateral lender Fonplata sold its first ever bond on Monday, raising Sfr150m ($150m) of five year money from Swiss investors.

Corporación Andina de Fomento (CAF) laminated its SSA membership card this week as it tightened pricing while equalling its largest ever dollar benchmark for size — despite political turmoil in one of its shareholders.

US sanctions have brought secondary markets in Venezuelan sovereign bonds and those of state oil company PDVSA to a standstill, leaving investors unable to trade. As a result, the bonds may be withdrawn from the JP Morgan Emerging Markets Bond Index.

Brazilian airline Gol found it difficult to prise its bonds out of investors’ hands with a tender offer in January, receiving only 14% take-up. CFO Richard Lark said it indicated investors’ positive sentiment towards Brazilian credit in general and Gol in particular.