Holders of dollar bonds will receive the semi-annual interest coupon, and AL30 and GD30 holders will also receive the first payment of capital amortization.
Dollar bonds: to reinvest or not to reinvest?
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This week, The Government will pay bondholders sovereigns in dollarsthe semi-annual interest coupon and those who have in their portfolio the Bonar 2030 (AL30) or the Global (GD30) They will also receive the first payment of the principal amortization. About, Ambit spoke to experts to determine When will the payment be?that There is expectation regarding reinvestmentand which are they the options they see as most viable for doing so.
Specifically, bondholders who have the Bonar 2029 (AL29) or Global 2029 (GD29) will receive US$0.5 for every US$100 of nominal value; those who own the AL30 or the GD30US$4,375 for every US$100; the creditors of the Bonar 2030 (AL35) or Global 2035 (GD35)US$1.8125 for every US$100; those of Bonar 2038 (AE38) or Global 2038 (GD38)US$2,125 for every US$100; those of Bonar 2041 (AL41) or Global 2041 (GD41)US$1.75 for every US$100; and those of Global 2026 (GD46)US$1,8125 for every US$100.
According to calculations by the Congressional Budget Office (OPC), this implies that the State has to disburse US$2.558 million. In fact, this day, although the Central Bank (BCRA) bought dollars, the reserves fell by US$1.601 billion to almost two-month lows.
Dollar bonds: to reinvest or not to reinvest?
For Ariel SbdarCEO of Cocos Capitalin response to the repeated question he received on social media about whether “is it worth buying AL30 now that the coupon is being cut?”, he replied: “As I said several times, The payment of the first and perhaps not the last amortization of the AL30 is an event that should not affect the net price. However, since the service represents a lot of dollars for bondholders, We can expect to see strong reinvestmentwhich would translate into demand for bonds starting Wednesday.”
However, he said that “Bonds are a thermometer of Argentina’s risk perception”The expert also noted that The market is waiting for other signals to continue the upward path or not. “If it does not assume an improvement in the accumulation of future reserves, “The demand for reinvestment will not be enough”held.
For its part, Leonardo Svirskystock exchange operator of fixed rentin conversation with this medium, said: “I think they will rebound because the vast majority of the holders of these bonds, especially at the local level, will reinvest those dollars in the same bond, which could lead to an increase in the coming days.“.
From Adcap In their “house view” they also agreed. “We believe that the market will reinvest a good part of the US$2.5 billion that will be paid between Tuesday and Wednesday in coupons and the amortization of 4% of the GD30 and AL30“, they indicated and expanded: “Assuming that the market remains in caution mode, but the Government continues buying dollars to ensure the payment of the coupon on the Global bonds, We see an upside of almost 15% additional in 2030 over 2035.”
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When is the ex-coupon date and the payment date?
As he explained to Ambiteconomist and analyst at Cohen Financial Allies, Juan Jose Vazquezthe ex-coupon date depends on whether it is the local market or abroad. As this Tuesday is a holiday for the Independence Day in Argentina, In operations with settlement in 24 hours in the local market, they were already quoted ex-coupon. Bonds trading on Wall Street, on the other hand, cut their coupons on Tuesday.
Besides, “Outside, everything that is a hard dollar bond with New York law is listed as ‘clean’ and everything that is under Argentine law is listed as ‘dirty'”he clarified. The “clean” price is the price of a coupon bond without including accrued interest payments. While the “dirty” price is a price quote for a bond, which includes accrued interest according to the coupon rate.
Source: Ambito
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