Argentina

Bondholders and analysts said that the Province of Buenos Aires had offered slightly better terms than the Argentine sovereign with its distressed debt exchange, but the offer, for $7.148bn of debt, is still likely too aggressive to gain traction with investors.

International capital markets are facing a reprise of one of their most eerily familiar tales in the next month: the will-they-won’t-they tension of the run-up to an Argentina default, writes Oliver West.

BNP Paribas has hired from Standard Chartered to bolster its Latin American debt capital markets team, GlobalCapital understands.

Argentina's bonds slipped again in secondary markets after finance minister Martín Guzmán confirmed to local media that the government had no plans to pay $503m of coupon payments due on Wednesday, despite the fact the move had already been widely anticipated.

Aeropuertos Argentina 2000, the operator of 35 airports in the country, is asking bondholders for temporary relief on amortisation and coupon payments as it looks to mitigate the impact of the Covid-19 pandemic on its cash flow.

A swift, firm rejection from the bondholder group considered to hold most sway in Argentina’s restructuring negotiations effectively closed the doors on any chance of success for the government’s first offer less than one business day after it had announced terms.

After making investors wait until the end of Friday's trading session that saw a strong bid for its bonds, Argentina finally proposed terms on its mammoth external debt restructuring. With early recovery rate estimates in the 30%-35% range, investors did not even wait until the weekend was over to express their discontent.

Bondholders are expected to fight a formal restructuring proposal from the Argentine government that should arrive on Friday and proposes heavy haircuts, say market participants. Argentina’s government appears ready to play hard ball.

Argentina’s move to suspend domestic law bond payments for the rest of the year encouraged holders of its foreign law debt, some of who are beginning to spy value in the battered curve.

For now, at least, Argentina appears to be asking its domestic bondholders to take the brunt of the government’s efforts to ease cashflow worries amid the Covid-19 crisis, providing upward momentum to foreign law debt prices.

As the initial government-imposed deadline for Argentina’s mammoth debt restructuring sailed by without a concrete offer to creditors having been put on the table, some analysts are worried that a hard default may be inevitable.

After its long-awaited debt sustainability analysis disappointed many investors and analysts, Argentina’s desire to solve its debt restructuring quickly may buckle under the pressure of its attempts to mitigate the impact of Covid-19.