The Secretary of Finance, Eduardo Setti, seems to take to the letter the old saying of the soccer environment that says that the “team that wins does not touch itself.” Thus, following that maxim, for the second debt tender in pesos in March raised an offer almost equal to that of the first call, with which he obtained a net financing of 114%.
This Wednesday the Palacio de Hacienda it has to renew some $284,000 million, of which 96% is explained by a LEDE. In turn, that title is concentrated in a 98% in the hands of private investors. That is why Setti bets on something that has already given good results.
Due to the problems that the drop in tax collection will generate this year as a result of the drought, which is estimated at half a point of GDP for all of 2023, The markets are paying close attention to the ability of the Government to obtain financing in the local capital market.
First, in this placement, the Treasury will make available only for Common Investment Funds (FCI) a LELITE maturing on April 28, which comes with a nominal rate of 72%, which will represent an effective annual rate of 101.54%.
On the other hand, he puts on the table two LEDES, in June and July, and two LECERs that expire in July and September. In the market it is indicated that with these two financial instruments the Treasury will try to add most of the necessary funding. Portfolio Personal Inversiones (PPI) highlighted, in a previous comment, that last week these two letters concentrated 61% of the funds raised, so a “similar situation” is expected, in which private investors take refuge in assets Short-term.
In the secondary market, the LECER that expires in July was offering a rate of 5.53% plus inflation. PPI proposes that it is necessary to pay attention to the Lede that expires in July, since in the last call it yielded an effective rate of just over 123%, against 126% that investors expected,
Besides, Economía offers two linked dollar bonds, one for July 31, 2023 and the other for April 30, 2024. In the first call last week, titles with a one-year term represented 20% of the placement. On that occasion, a dual bond was offered to February 2024. However, analysts in the market consider that these types of bonds are not at the best time.
Fitch Warns About Swap
While for analysts the government could obtain up to $1 trillion in financing with the intrastate debt swap, For the Fitch risk rating agency, the operation constitutes a default. This was stated by Todd Martínez, director for the region of the rating agency, based in New York. Todd explained at the 15th Symposium of the Argentine Institute of Finance Executives (IAEF): “There were two swaps this year: the repurchase of foreign bonds and the local swap: we did not think that these were in disadvantageous conditions because we did not think that without those swaps the government would have had to default, but this swap is a change of criteria, because it is a forced change in the conditions of the debt by decree”, affirmed Martínez, who argued that “although the creditors are within the public sector, when it comes to tradable bonds that may be in private hands, for us it is also a default”.
Source: Ambito
