Rush of LatAm primary issuance expected post-Labor Day

jueves 18 de agosto de 2016 15:38 GYT

By Paul Kilby

NEW YORK, Aug 18 (IFR) - Latin American bankers are bracing for a post-Labor Day boost to dollar bond supply from companies retiring expensive debt or merely sprucing up their balance sheets, as they take advantage of robust appetite for the region's debt.

A sustained rally in Latin American debt has already spurred a flood of refinancings since June 23 when the UK's referendum vote to exit the European Union encouraged further monetary easing across the developed world.

Since June 29, the region's issuers have already tapped the international bond markets for close to US$21bn, pushing primary volumes to US$85.39bn year to date, just past the US$83.41bn seen for the entire 2015, according to IFR data.

"It has been a one-way train and Brexit only slammed the foot on the accelerator," a syndicate manager told IFR. "Money is flowing toward EM and LatAm in particular."

The uptick has come as a welcome surprise to bankers who just seven months ago had predicted another slow year for a region hit hard by a commodities rout and Brazil's economic crisis.

Optimism over a change of leadership in both Brazil and Argentina, combined with the recent grab for yield and a bounce in crude prices, has however forced a change in their outlook.

"The market is in the best shape it has been for a while, and nimble borrowers will mandate between now and September," a second syndicate banker told IFR.

"The idea is to strike when the iron is hot so it will be reasonably busy."   Continuación...