Such a high number of maturities could lead one to assume that the Minister of Economy, Luis Caputo, has to resort to exchange operations, as it was done throughout 2023 but, strictly speakingmuch of it would have its renewal assured.
That is because most of the securities that mature are in the hands of state agencies and banks. Both of them guarantee a successful renovation. One of the largest holders of Treasury securities is the Central Bank in whose portfolio there are $31 billion. 20% of the financial entity’s assets are made up of this type of bonds in pesos.
Debt in pesos: Economy called a new tender
In that context, Economy called for a new tender for securities this Tuesday. It will go on the market with three Boncers with maturities in June 2026, 2027 and 2028, with zero coupon. But as reported in the official call, this placement will have the objective buy back Treasury debt. Nothing is said about the February due dates.
In the background there is an operation that is trying to intensify Economy and the management of the Central Bank, which is to neutralize the greatest amount of money possible to improve monetary aggregates and thus improve the entity’s balance sheet.
In January, according to data from the securities company GMA Capital, the monetary base fell 34% compared to a year ago to $7.4 trillion. When Javier Milei took office it was at $10 billion and it remained that way. The aggregate Private M3, which constitutes the broad money supply, fell 19% in the same period and it was about $44 billion.
Among other factors of the reduction of the base are the return of advances to the Treasury, the purchase of dollars by the BCRA, the repurchase of Treasury securities to which is added the sale of the bond for importers, the BOPREALof which US$900 million remain to be sold to complete the quota of US$5,000 million of series 1.
Market sources pointed to Ambit which is expected -after the placement of BOPREAL-, the Government begins to configure a debt exchange to improve the maturity profile of 2024. Luis Caputo already had an exchange of ideas with the banks a few days ago about how liability management could be done.
Among the operators, it is thought that once the Government sorts out the debt situation of the importers, which creates noise in the operation, it will focus on setting up an operation of exchange, in which the banks will have a greater participation.
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