Province of Chubut renews Argentina bond issuance
By Paul Kilby
NEW YORK, July 19 (IFR) - Argentine borrowers continued to make their way to market on Tuesday amid what a positive backdrop for emerging market credits despite broader headline risks.
The Province of Chubut was moving forward with a benchmark US dollar 10-year amortizing bond after holding fire on Monday in the wake of the attempted coup in Turkey over the weekend.
LatAm markets have largely been unaffected by troubles in Turkey, as accounts seek yield in EM corporate and sovereign names after receiving substantial inflows in recent weeks.
"EM is still well bid," a DCM banker told IFR on Tuesday. "There is a lot of crossover money [coming into the asset class] and the back-up in US rates if anything has been an excuse to buy."
While Argentine President Mauricio Macri's market-friendly policies are receiving some push-back from a populace angered by rising inflation, investors largely still like the story.
"What is keeping Argentina spreads on a tightening mode is the continued search for yield," Jorge Piedrahita, CEO of broker Torino Capital, wrote in an email note to clients this week.
Leads on Chubut's deal nevertheless started conservatively Tuesday morning, approaching accounts with initial price thoughts of low 8% - considerably wide to where most other Argentine provincial bonds had been trading.
Bank of America Merrill Lynch and BNP Paribas are acting as bookrunners on the bond sale. Continuación...