El Salvador to Sell $1.8 Billion in Bonds

The Salvadoran Congress approved a financial plan to meet debt payments.

Monday, May 25, 2009

The plan envisages the sale of $1.8 billion in global bonds and the reorientation of $950 million in World Bank and IDB loans to make payments on short-term debt.

With the bond sale, the country seeks to restructure its debt so that it depends more on the long rather than the short term.

According to a Reuters article published in Forbes.com: "This plan aims to give the next president, Mauricio Funes, a respite to solve the fiscal problems that led Standard and Poor's to lower El Salvador's debt rating."

More on this topic

Honduran Public Debt For Sale

March 2012

The new finance minister has announced plans to restructure Honduras’ public debt of about $5.8 billion, almost all of it in short-term format, with high interest rates.

Honduras is facing a severe debt problem which could become a disaster for their public finances.

Public debt, external and internal, had reached $5.772 billion up to December 31st, 2011 .

Guatemala: External Debt Exceeds $5,620 million

December 2011

The highest percentage of external debt is with multilateral organizations; to the IADB alone $2,192 million are owed.

Of the total debt, 39% corresponds to the Inter-American Development Bank (IDB), 24% to the International Bank for Reconstruction and Development (IBRD), 19% to the Central American Bank for Economic Integration (BCIE), and the rest to others.

Panama Sells $1 Billion Bonds

November 2009

The Government raised $1 billion through a 10-year bond offer, after an improvement in its sovereign debt ratings.

The new rating pushed the country to the verge of investment grade. Credit Suisse Group AG and Deutsche Bank AG were the underwriters.

"The securities were priced at 99.796%, with a yield of 5.224%, maturing in January 2020", reported Prensa.com.

El Salvador could Issue $800 Million in Euro-bonds

July 2009

The objective would be to swap short term Treasury notes, which will expire soon.

In May Congress approved a $1.800 million debt plan, which includes $800 million for facing the due date of short term debts, as well as $650 million for the expiration of foreign debt.

The Salvadoran Foundation for Social and Economic Development(FUSADES), recommended the issuance of $800 million worth of Euro-bonds to cover the expiration of the Treasury Notes. This way, a short term debt would be restructured into a long term one.

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