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NEW YORK, Nov 2 (IFR) - A more supportive backdrop for LatAm credits could bring out more borrowers this week after regional development bank CAF announced a five-year euro trade on Monday.
While bankers are not predicting a flood of issuance in coming weeks, some think a few roadshows could be announced this week.
"A Fed hike this year is not off the table, and that threatens to disrupt the stability, but perhaps guys are starting to realize that this is the last time they can get prefunding when the 10-year Treasury is in the low 2%," said a syndicate banker.
However, mixed economic data across the globe has left markets in two minds over the timing of Fed hikes and some bankers believe issuers would prefer to wait until next year.
"My impression is that people are happy to shut it down for the year," said a senior DCM banker.
Several Mexican names have been sitting in the pipeline for weeks despite a more supportive backdrop, including Mexican REIT Fibra Uno and white goods manufacturer Mabe.
"Fibra Uno's (third quarter) numbers were surprisingly positive, and it doesn't look like their spreads are going to tighten more over the next couple of weeks," said the syndicate banker.
"Perhaps they are waiting for a better window next year."
The 2024s and 2044s issued by the REIT have tightened a touch in recent days to 265bp and 375bp, the banker said.
The company hasn't taken advantage of the low rate environment, but with no significant maturity spikes until 2017, it is in no rush for liquidity, noted local Mexican broker GBM in a recent report.
Meanwhile, CAF emerged on Monday with initial price thoughts of mid-swaps plus 80bp-85bp on a benchmark-sized five-year euro bond through Bank of America Merrill Lynch, Credit Agricole, Credit Suisse and HSBC.
At that level, leads are testing appetite at around 20bp back to the borrower's curve, according another syndicate banker.
Elsewhere, Argentine assets were also inching higher after rallying last week on what is now an expected win for market favorite candidate Mauricio Macri in the presidential elections on November 22. Bonar 2024s were up about 20 cents on the day at 105.40-106.00.
The short of Venezuelan state-owned oil company PDVSA's curve was also catching a bid as investors recycled funds paid last week on maturing debt. Old PDVSA 2017 and 2021s up about a 1/4 point at 57.25 and 42.90, respectively.
PIPELINE Chilean financial institution Tanner kicked off fixed-income investor meetings as it looks to market a possible 144A/Reg S bond sale through Bank of America Merrill Lynch and JP Morgan.
Roadshows finish on November 4. Expected ratings are BBB- by S&P and Fitch. The company is considering a US$300m five-year senior bond, according to Fitch.
Mexican white-goods manufacturer Controladora Mabe has finished investor meetings through Barclays, Bank of America Merrill Lynch, Citigroup and JP Morgan. Ratings are BB+/BB+.
Mexican REIT Fibra Uno completed meetings with investors through Bank of America, Credit Suisse, HSBC and Santander.
Terrafina, another Mexican REIT, has finished meeting accounts as it markets a potential US$400m-$500m bond offering. The borrower mandated Barclays and Citigroup as lead managers, with Itau as co-manager. Expected ratings are Baa3/BBB-.
Brazilian airline GOL Linhas Aereas Inteligentes (B3/B-/B-) completed roadshows with Morgan Stanley, Credit Suisse and Citigroup. (Reporting By Paul Kilby; editing by Shankar Ramakrishnan)