Sovereign Issuer of the Year - Argentina

Sovereign Issuer of the Year - Argentina

Bonds Debt Capital Markets Corporate & Sovereign Strategy Economy & Policy Fixed Income Politics Argentina

In January 2017, in the days leading up to Donald Trump’s inauguration, many Latin American issuers warily watched the bond markets wondering if volatility might set in once the new US president took office.

Sensing an opportunity, Argentina pushed ahead with its plans for its first cross-border sale of the year. The sovereign increased the planned size of the bond issue, beefing it up by $2 billion to $7 billion to tap the market a day before Trump took office.

In one fell swoop, Argentina managed to cover a large part of its planned dollar issuance for the year in a transaction that saw order books swell to more than $21 billion.

The transaction was one of several during the awards period that saw Argentina make remarkably effective use of the bond markets. Led by Finance Minister Luis Caputo, Argentina pushed new boundaries with a 100-year century bond issue and diversified its currency exposure with euro- and Swiss franc-denominated bond sales to win LatinFinance’s Sovereign Issuer of the Year award.

In March, Argentina made its return to the Swiss franc bond market after nearly 20 years, printing a 3.5-year bond for 400 million Swiss francs ($409 million) with a 3.375% coupon. BNP Paribas, Credit Suisse and UBS coordinated the trade.

Three months later, Argentina surprised some investors by issuing a landmark 100-year bond. Capitalizing on investors’ aggressive hunt for yield and duration, the sale of $2.75 billion worth of US-dollar denominated bonds was three times oversubscribed. Although the sale was backed by anchor interest and came together after inquiries from investors, it marked an aggressive effort by Argentina to take advantage of global conditions to lock in cheap funding.
Argentina reeled in its initial price guidance of 8.25% to 7.9% as orders reached around $10 billion. Citi and HSBC were lead bookrunners on the deal, and Nomura and Santander were co-managers.

Argentina also ventured into the euro bond market in October 2016, six months after its return to the international capital markets. The €2.75 billion ($3.31 billion) dual-tranche bond sale helped Argentina to expand its investor base and diversify its currency reserves under a deal led by bookrunners BBVA, BNP Paribas and Credit Suisse. LF