Archive for May 13th, 2012

New Pdvsa Bond Sold Directly To State Banks

May 13, 2012

After weeks (months?) of rumors, late Friday night, PDVSA finally announced a new bond. This time around it is a 2035 issue payable in three parts in 2033, 2034 and 2035. The bond will have a coupon of 9.75%.

The bond will not be sold to individuals or companies, it will all be sold to State banks, largely to the Central Bank in order to supply the bank’s foreign exchange system SITME. While many people are dissapointed that they will not be included, it makes sense, the operational hassle of thousands of people applying to get only $1,000 at the preferential rate of Bs. 4.3 per dollars simply does not make sense.

Reportedly, there were disagreements about whether to issue or not, but like so many “secrets” in this opaque Government, we might never know if they were true or not. The truth is that since January there have been rumors of a bond, then three weeks ago, the Minister if Energy and Oil said that for now, PDVSA was not going to issue, a sure sign something was up. Last week, rumors were rampant, now here it is, the debt continues to grow