Emphasizing the Positive
Argentina has cast a long shadow over the region, but a select group of issuers can still raise capital in any form, as long as they get the price, structure and timing right.
At the height of the northern hemisphere summer, when
markets are normally in the doldrums, innovative and successful
deals came out of Latin America, proving that investors are
able to look beyond Argentina's crisis and consider a deal on
its own merits. But issuers need to offer investors structures
with plenty of reassurance and hefty yields.
US high-grade investors in particular liked the attractive
yields available from Latin America's less risky credits. El
Salvador, an investment grade issuer, went to the international
market in July to raise $353.5 million with a 10-year bond.
Credit Suisse First Boston and Deutsche Bank led the deal,
priced at 350 basis points over US Treasurys. The issue
required courage, coming at a time when the market was wracked
with anxiety over a possible Argentine default.
Rafael Barraza, governor of El Salvador's Central Bank says,
"We could have closed the deal with just...
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