DEAL OF THE YEAR: Sovereign Liability Management

DEAL OF THE YEAR: Sovereign Liability Management

Bonds Uruguay Corporate & Sovereign Strategy

Last April, Standard & Poor’s lifted Uruguay’s credit rating by one notch – returning the country to investment grade after a decade of its debt being rated as junk. A great part of its return to form was due to a remarkable dollar-to-peso liability management operation in December 2011 of a size typically reserved for the largest sovereign LatAm issuers. The operation allowed Uruguay to extend duration, de-dollarize its curve, reduce foreign currency and refinancing risk and provide liquidity to existing bonds. It also set a template for other sovereigns to follow. “We were able to increase the percentage of local currency, execute at time of volatility [the US had been downgraded and

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