por carl_ » Jue Nov 11, 2010 1:57 pm
Economy | November 11, 2010 [ 10:03 ]
Peru issues record $2.5 billion, 40-year bond abroad
By Gabrielle Coppola and John Quigley
Peru sold $2.5 billion of bonds denominated in dollars and soles today in the biggest sale of local currency debt by a Latin American government.
Peru sold $1 billion of 40-year bonds to yield 5.875 percent, and the equivalent of $1.5 billion of bonds denominated in soles due in 2020 to yield 5.75 percent, the Finance Ministry said in an e-mail today. The dollar bond’s yield is the lowest for any regional issue of 30 years or more, the ministry said.
The sale reflects investor confidence in Peru and its sol- denominated assets, the ministry said. The issue reduces the government’s debt repayment burden, extends the average life of public debt and replaces debt in foreign currency with debt denominated in soles, it said.
Finance Minister Ismael Benavides said it was an opportune moment to tap the international market, ”given the high liquidity, low global rates and considering the demand for Peruvian papers.”
Bank of America Corp. and Morgan Stanley arranged the sale, according to a person familiar with the offering who couldn’t be identified because he isn’t allowed to speak publicly.