South America

Chile published its first sustainable bond framework on Wednesday, saying it wanted to build on the last year’s green bond issues to further diversify its investor base.

Argentine power company Gennaia is at risk of defaulting on its domestic dollar bonds as a result of capital controls issued by the Central Bank of Argentina (BCRA), Fitch said on Tuesday as it slashed the rating on the issuer’s international notes.

As the Argentine Province of Buenos Aires approaches six months in default, a creditor group holding nearly half of the issuer’s international bonds has hired a major international law firm and says it is “prepared to evaluate all available options”.

Chile, the only Latin American sovereign to have issued a green bond, is weighing up different thematic bonds as it makes its funding plans for 2021.

Just one day before a likely hard default on its $150m of 7.875% 2024s, Argentina's City of Córdoba on Wednesday asked bondholders to modify the payment terms according to a plan that already has the backing of Chilean asset management firm Moneda.

Chile, which in 2019 became the first Latin America sovereign to issue a green bond, is weighing up different thematic bonds as it makes its funding plans for 2021, according to a senior funding official.

Eye-watering bond yields on Argentina’s recently restructured sovereign bonds indicate that investors have little faith in its economic plans. That will make it hard for issuers and investors to see eye-to-eye in the wave of provincial debt restructuring talks that has followed the sovereign's deal with bondholders.

Chile's sovereign dollar bonds hardly budged in Monday trading despite its electorate voting to change the country's constitution the night before. But analysts believe uncertainty along the road to a new political agreement could harm investment, and the new constitution will likely drive up government spending.

Two corporate deals on Monday and a tiny tap from a Paraguayan beef exporter on Wednesday were all investors had to choose from in Latin American primary bond markets this week as issuance remains light ahead of the US elections next month.

Brazilian oil company Petrobras this week announced it will spend $1.95bn on repurchasing existing bonds via a tender offer, as the rapid pace of its reduction continues.

A group of Neuquén’s bondholders swiftly rejected an improved debt restructuring offer this week, saying any reduction in interest payments on the Argentine province’s senior secured bonds cannot be justified.

Frigorífico Concepción, the Paraguayan beef exporter, raised $40m in bond markets on Wednesday after a three-day sales process.