Panama preps first Euroclearable notes

Panama preps first Euroclearable notes

Bonds Debt Capital Markets Corporate & Sovereign Strategy Economy & Policy Fixed Income Panama Central America Europe

Panama is getting ready to sell $750m in Euroclearable local bonds amid growing confidence in the economy and lower yields on US Treasury notes, LatinFinance has heard.

After meetings in Panama City and London, finance officials will see investors in New York on Tuesday and price the notes on Wednesday or Thursday, said a bonds trader in Panama City.

The underwriters Goldman Sachs and Morgan Stanley did not return requests for comment, but the trader in Panama City said the deal could reach $750m because the government has to pay $600m in 2019 notes in June.

Panama will make the local notes Euroclearable to allow international investors to participate in the deal because the local market cannot absorb such a large sum on its own, the trader said.

Panama's 2028 bonds are currently trading at 80bp over US Treasury notes, "so to make this attractive [for foreign buyers], they will have to pay 30bp to 40pb over that," the trader said.

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