South America

Argentina’s largest province, Buenos Aires, has extended the expiry date on its debt exchange for the 14th time. But unless the province makes important improvements to the terms, the offer has no chance of success.

Empresas CMPC, the Chilean pulp and paper producer, began investor meetings on Monday ahead of a proposed sustainability-linked bond (SLB) that investors say is likely to attract strong demand as long as the volatility seen in rates market on Monday does not worsen.

Bonds issued by the Province of Buenos Aires enjoyed a rally this week as some investors sensed a restructuring agreement is closer, even as a group of bondholders finally lost patience and sued Argentina’s largest province in New York’s courts.

Investors holding over a quarter of the Province of Buenos Aires’ international bonds said they would “vigorously pursue” the legal proceedings that they began on Tuesday against Argentina’s largest province, which has been in default since April 2020. But bonds rallied as some saw the move as a sign that a resolution was nearing.

Peru’s largest lender, Banco de Crédito del Perú, offered a slim new issue concession on Tuesday as it sold $500m of tier two bonds, with bankers saying that liquidity dynamics remained favourable for Latin American issuers.

Banco de Crédito del Perú (BCP), Peru’s largest lender, scheduled investor calls beginning Monday morning ahead of a proposed 10.5 year non-call 5.5 tier two bond that will be used to refinance existing bonds.

LatAm bankers and investors say a strong issuance window for non-Brazilian credits has opened, as political and fiscal concerns take their toll in Latin America’s largest economy.

Bond bankers say new issuance from Latin America is unlikely to pick up until after Easter, even though they believe the technical dynamics in the market remain favourable for issuers.

Minerva and Marfrig, the Brazilian meatpacking rivals, said on Monday that they would prepay dollar bonds as part of continued efforts to reduce leverage.

Faltering momentum in Latin American bond issuance has put this year's unprecedented surge of green and sustainable deals on pause. But even if volatility persists, as global bond markets deal with rising US interest rates, LatAm issuers will not only maintain their focus on ESG, but they may find sustainability credentials are more valuable than ever.

Peruvian food retail and pharmacy group InRetail Consumer took advantage of calmer markets and the scarcity value of Peruvian corporates to achieve higher oversubscription and greater pricing compression than any Latin American new issue since February 18. on the way to a $600m seven year on Thursday.

As financial institutions across asset classes raised gender-themed funding this week, Colombia’s vice-president Marta Lucía Ramirez took International Women’s Day as a chance to hail the potential of the sovereign using bond markets to fund its gender equality initiatives.