Mexico is reaching out to investors ahead of a potential peso-denominated sustainable bond issuance, according to people familiar with the matter.
(Bloomberg) — Mexico is reaching out to investors ahead of a potential peso-denominated sustainable bond issuance, according to people familiar with the matter.
Debt arrangers for the Latin American country may start taking orders for the transaction in the coming days, said the people, who asked not to be named ahead of a public announcement. No final decision about whether to push ahead with the transaction has been made, the people said.
Mexican officials, including María del Carmen Bonilla — the head of the finance ministry’s public credit unit — are holding a series of calls with domestic and international investors, the people said. The investor outreach is being organized by six banks, including HSBC Holdings Plc.
A press official for the finance ministry didn’t immediately respond to a request for comment. HSBC also didn’t respond.
The potential offer would be the first issue of so-called “BonoS” — a new type of government-issued debt linked to the sustainable development goals of the United Nations — which would be sold at fixed rates with maturities ranging from three to 30 years, Deputy Finance Minister Gabriel Yorio said in June.
The bonds can be settled via Euroclear, making it easier for international investors to buy the securities.
Demand from international investors for Latin American local currency bonds has improved in recent months. Central banks in the region started tightening credit conditions to rein in inflation before policy makers in the US and elsewhere followed suit. Now, some countries are beginning to cut rates or are expected to do so, a move that typically boosts valuations of debt securities.
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–With assistance from Maria Elena Vizcaino.
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