Smarter News Now
  • About Us
  • Privacy Policy
  • Terms & Conditions
  • Contact Us
  • Email Whitelisting
No Result
View All Result
  • Top News
  • Economy News
  • Forex News
  • Investing News
  • Stock News
  • Politics News
  • Editor’s Pick
  • Top News
  • Economy News
  • Forex News
  • Investing News
  • Stock News
  • Politics News
  • Editor’s Pick
No Result
View All Result
Smarter News Now
No Result
View All Result
Home Investing News

El Salvador to buy back some debt in surprise move

by
July 27, 2022
in Investing News
0
El Salvador to buy back some debt in surprise move
0
SHARES
11
VIEWS
Share on FacebookShare on Twitter

SAN SALVADOR – El Salvador‘s president announced on Tuesday a plan for a voluntary repurchase offer to holders of bonds maturing between 2023 and 2025.

The operation would be partially funded by reserves allocated last year by the International Monetary Fund and a loan from a Central American multilateral lender, the finance minister said later on Tuesday.

President Nayib Bukele has been under pressure to demonstrate healthy public finances as the country’s options dwindle ahead of an $800 million bond maturity in January.

His bet on bitcoin, which operates in El Salvador as a legal tender alongside the U.S. dollar, narrowed El Salvador‘s financing options as the International Monetary Fund closed the door to a loan of over $1 billion after the cryptocurrency move.

In a post on Twitter, Mr. Bukele said the country has enough cash not only to pay debt commitments at maturity, but to purchase the debt even before it matures.

The bond maturing in January was trading at 74 cents on the dollar on a 82% yield, while the remaining issues traded in distressed territory hovering in the low 30 cents.

Prices had started to spike last week, partly boosted by a Morgan Stanley note that said Salvadoran debt was too cheap and prices were below most restructuring scenarios.

MARKET PRICE BUYBACK

The buyback process would likely cost around $1.7 billion, according to a Citi Research note on Tuesday that said the estimate is expected to rise based on early market reaction.

“Today we are sending 2 bills to Congress to ensure that we have the available funds to make a transparent, public and voluntary purchase offer to all the holders of Salvadoran sovereign debt bonds from 2023 to 2025 at whatever the market price is at the time of each transaction,” Mr. Bukele tweeted, adding that “the market price will probably move upwards once we start buying all the available bonds.”

El Salvador‘s unicameral Congress approved both bills, one requesting to use $360 million in funds from special drawing rights allocated by the IMF to repurchase the bonds, and another to request a $200 million loan from the Central American Bank for Economic Integration (BCIE), in majority votes Tuesday evening.

The Central American country’s total public debt was about $24 billion in March, according to central bank data.

The debt buyback offer, which was unexpected, will likely cause the price of short-end bonds to rise, Citi analysts added.

“Risks are high and the situation remains very fluid,” they wrote.

Mr. Bukele added that the buyback will start in six weeks.

It was unclear where the more than $1 billion remaining to complete the operation would come from. – Reuters

ShareTweetPin

Related Posts

Stocks decline on profit taking, recession fears
Investing News

Stocks decline on profit taking, recession fears

August 23, 2022
Peso climbs vs dollar as RTB offer starts
Investing News

Peso climbs vs dollar as RTB offer starts

August 23, 2022
PNR cancels bids for 3 projects after finding them ‘non-feasible’
Investing News

PNR cancels bids for 3 projects after finding them ‘non-feasible’

August 23, 2022
Senate grills Rodriguez on approval procedures for sugar import order
Investing News

Senate grills Rodriguez on approval procedures for sugar import order

August 23, 2022
Trade dep’t expecting sugar price monitoring report by Friday
Investing News

Trade dep’t expecting sugar price monitoring report by Friday

August 23, 2022
Fisherfolk seek halt to reclamation on municipal fisheries
Investing News

Fisherfolk seek halt to reclamation on municipal fisheries

August 23, 2022
Next Post
Digital nomads seek sun, sea and sustainability as remote work booms

Digital nomads seek sun, sea and sustainability as remote work booms

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Email Address *
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!
 

Recommended

Top 4 Trends Fueling Smart Lighting Market Statistics through 2028

Top 4 Trends Fueling Smart Lighting Market Statistics through 2028

June 15, 2022
Emperador sets secondary listing date in Singapore

Emperador sets secondary listing date in Singapore

July 11, 2022
Japan ex-PM Abe in grave condition after being shot during speech

Japan ex-PM Abe in grave condition after being shot during speech

July 8, 2022
Startups invited to pitch clean energy solutions

Startups invited to pitch clean energy solutions

August 11, 2022
Highly appealing features of bitcoin making it popular!

Highly appealing features of bitcoin making it popular!

August 14, 2022
Time to get serious about reducing, reusing and recycling

Time to get serious about reducing, reusing and recycling

June 1, 2022
  • About Us
  • Privacy Policy
  • Terms & Conditions
  • Contact Us
  • Email Whitelisting

Copyright © 2022 SmarterNewsNow.
All Rights Reserved.

Disclaimer: SmarterNewsNow.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

No Result
View All Result
  • About Us
  • Contact Us
  • Email Whitelisting
  • Home
  • Privacy Policy
  • Terms & Conditions
  • Thank You

Copyright © 2020 SmarterNewsNow. All Rights Reserved.