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Mexico Whittles Down Its Bradys

Feb 1, 2003

In September 2002, Mexico issued a $1.75 billion, 20-year global bond to exchange a batch of outstanding Brady bonds and raise new money. The government convinced investors to exchange $1.3 billion of par Brady bonds, which are collateralized by US Treasury bonds, and then sold an additional $450 million of the new global issue. The deftly executed private exchange that resulted in the year's largest bond issue reinforced Mexico's skill in managing its debt and wins LatinFinance's liability management deal of the year award.

Robert Kay, managing director of emerging market syndication at Credit Suisse First Boston, one of the deal's lead managers, says crossover investors quickly picked up the new bonds, hungry for alternatives to scandal-ridden US corporate bonds. The bond priced at 97.248 with an...

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“The crisis has been a setback for reserve diversification."

Jan Dehn, Ashmore Investment Management