Brazilian and Mexican domestic market bond
deals had showed a bit of immunity to the rough conditions that
have affected the international bond markets - that is, deals
were getting done at all.
As the pessimism continues, however, it is
getting tougher. Brazil's Rodovias do Tietê is heard pricing a
1.07 billion reais ($473 million) transaction at
the wide end of a price range. Full details remain to be
released, but the deal was also helped by a guarantee from the
Comgas delayed a debenture sale earlier
this month, and today BNDESPar appears to be opting to wait for
a 2.5 billion reais sale that would be Brazil's
largest deal this year. Others in the pipeline, such as
Raizen, still have a bit of time to wait and see how things
Mexico has a history of completing
domestic deals in previous times of international sluggishness,
priced the first bank RMBS bond since 2009 this
week. However, it appears that floating rate transactions
may be the only option going forward, with state oil producer
Pemex and restaurant operator
Alsea clinching deals or 2.5 billion pesos each
this week. Pemex
opted to wait on a much larger fixed-rate global depository
Genomma Labs also is being cautious with a fixed-rate note
it had planned for this week.
"Issuers that are looking at fixed and
floating will probably be looking at floating," says a Mexico
City debt investor. "This is where the appetite is."
A further test will be the Comisión
Federal de Electricidad, planning a
15 billion peso sale scheduled for Tuesday that is
meant to include both fixed and floating-rate portions.
In Chile, which has been a much less
active market this year, issuers are hopeful that a 5 million
UF ($226m) deal from
Banco Estado is able to get done Tuesday.
Once the Rodovias do Tietê
deal finalizes, Brazilian issuers will have raised 7.92
billion reais this year using the rule 400
widely-distributed format, according to CVM data. This
suggested a roughly equal pace to 2012, when they did 7.0
billion reais during the corresponding period.
In Mexico the 99.66 billion pesos raised in 2013
through this week in the local markets was up from 81.68
billion pesos during the corresponding period in 2012.