Brazil

Brazil iron ore pellet producer Samarco Mineração’s bonds hit the mid 30s on Tuesday as Fitch reduced the borrower’s rating from BBB to BB- a month after two of the company’s dams burst in the state of Minas Gerais, causing heavy human and environmental damage.

André Esteves resigned from his positions as chairman of the board and chief executive of BTG Pactual on Sunday following his arrest on November 25 as part of Brazilian authorities’ investigation into corruption at Petrobras.

Banco Nacional de Desenvolvimento Econômico e Social (BNDES) has bought back $640m of senior unsecured notes at a discount, taking advantage of sub-par dollar prices and its strong cash position to reduce its debt burden.

The arrest of BTG Pactual’s chairman and chief executive dragged the Brazilian banking sector into the Petrobras corruption investigation this week, as bond market participants said fears were running high that Lava Jato would uncover even more skeletons in the closet.

The arrest of one of the most respected figures in Latin American banking on Tuesday could be the start of a new painful chapter in Brazil’s corruption scandal, Latin American bond market participants have warned.

Banco Nacional de Desenvolvimento Econômico e Social (BNDES) will buy back $640m of senior unsecured notes at a discount, taking advantage of sub par dollar prices and its strong cash position to reduce its debt burden.

Banco Nacional de Desenvolvimento Econômico e Social (BNDES), the Brazilian government-owned development bank, on Monday became the latest financial institution from the country to look to take advantage of depressed bond prices by repurchasing debt below par.

Brazilian iron ore producer Samarco Mineração’s bonds recovered slightly on Monday despite the issuer’s owners giving mixed signals regarding its attitude to the crisis-ridden company.

Banco Nacional de Desenvolvimento Econômico e Social (BNDES), the Brazilian government-owned development bank, on Monday became the latest financial institution from the country to look to take advantage of depressed bond prices by repurchasing debt below par.

It is already evident that the human and environmental impact of last week’s burst dam at an iron ore mine in Minas Gerais, Brazil, will be tragic. But those left with the uneasy task of analysing the financial fallout on the company that operated the mine still have more questions than answers as the bonds sold off 30 points.

Goldman Sachs this week announced the closure of its dedicated BRIC (Brazil, Russia, China and India) fund after nearly 10 years. The move signalled the end of the BRIC era, as this year saw recessions plague Russia and Brazil while growth in China stalled.

The level of support that Brazilian iron ore pellet producer Samarco Mineraçao’s high profile shareholders provide the company could determine just how serious the effects of last week’s dam accident will be, said Fitch on Wednesday.