City of Buenos Aires mulls financing options

martes 28 de octubre de 2014 17:53 GYT

* City considering callable bond, ECP and US dollar-linked

* Short-term funding would buy time in election year

* Double-digit yields eyed on potential int'l bond

By Davide Scigliuzzo

NEW YORK, Oct 28 (IFR) - The city of Buenos Aires is sounding out foreign investors on short-term funding as it looks to refinance upcoming maturities, according to two sources with direct knowledge of the meetings.

Options include a new five-year non-call two international bond, Euro Commercial Paper (ECP), and US dollar-linked bonds that are issued domestically in dollars but payable in pesos.

"They are a very well-run city and they don't want to be in a difficult position in 2015, so they are doing their homework," one source said.

Yet the city faces a dilemma. US dollars would allow it to build a buffer to meet international bond maturities without draining Argentina's dwindling foreign exchange reserves.

But that is much costlier - and more complicated - than tapping local peso funding.   Continuación...