South America

Brazilian iron ore producer Samarco Mineração’s bonds recovered slightly on Monday despite the issuer’s owners giving mixed signals regarding its attitude to the crisis-ridden company.

Banco Nacional de Desenvolvimento Econômico e Social (BNDES), the Brazilian government-owned development bank, on Monday became the latest financial institution from the country to look to take advantage of depressed bond prices by repurchasing debt below par.

Fitch has cut the credit rating of Pacific Exploration and Production (formerly Pacific Rubiales) by two notches from B+ to B- and placed the issuer on rating watch negative after the agency revised its oil price outlook.

It is already evident that the human and environmental impact of last week’s burst dam at an iron ore mine in Minas Gerais, Brazil, will be tragic. But those left with the uneasy task of analysing the financial fallout on the company that operated the mine still have more questions than answers as the bonds sold off 30 points.

Goldman Sachs this week announced the closure of its dedicated BRIC (Brazil, Russia, China and India) fund after nearly 10 years. The move signalled the end of the BRIC era, as this year saw recessions plague Russia and Brazil while growth in China stalled.

The level of support that Brazilian iron ore pellet producer Samarco Mineraçao’s high profile shareholders provide the company could determine just how serious the effects of last week’s dam accident will be, said Fitch on Wednesday.

Argentina’s leading mortgage lender is looking to raise at least $200m in the international bond markets to finance a tender offer of outstanding debt due April 2016.

Chilean financial services firm, Tanner appeared to have done a disappearing act this week, seemingly cancelling its attempts to raise dollar debt having released price thoughts last Friday.

Moody’s has cut the rating on Brazilian shopping centre owner General Shopping’s $315m unsecured bonds from B2 to Caa1, saying there is an “elevated” risk of default in the next year or two.

Moody’s removed the negative outlook on Argentina’s Caa1 rating as analysts said the political climate is looking more positive for holders of the sovereign’s debt.

Options and swaps market price action suggests that foreign investors are starting to believe that the macroeconomic and political risks for Brazilian assets have found a bottom.

The Petrobras corruption scandal continues to trouble the firm's business partners as Odebrecht Offshore Drilling Finance received another downgrade on Friday following the September cancellation of the ODN Tay IV contract.