Stocks

Guatemala prepares ground for possible bond deal

NEW YORK, April 14 (IFR) - Guatemala has been preparing documentation to be ready to come to the international bond markets, finance officials told IFR.

"It is something we are considering and we are ready to do it and will finish analyzing whether the market will give us some space," Victor Martinez Ruiz, the country's finance minister said on the sidelines of the IMF meetings this weekend.

Any deal will probably have a minimum size of US$500m - but could go up to US$1bn - and will be part of a financing strategy that includes local currency and multilateral debt.

The Central American country hasn't been in the market since May 2017 when it issued a 4.375% 2027 to yield 4.5%. That security has since widened to trade last week at 4.77%-4.88%.

Even so, markets have largely been receptive to new issues out of the region, as investors look to EM in a lower-for-longer interest rate environment in developed countries.

"We understand there is a window of opportunity is open," he said.

Guatemala, rated Ba1/BB-, has been shaken by corruption scandals, and the expulsion of investigators of a UN-backed anti-corruption group last year hasn't helped reputational risks.

Moody's called the move credit negative ahead of presidential elections in June this year.

Despite political stresses, Guatemala is a country with macroeconomic stability, financial solvency and a track record of stable growth, said Martinez.


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