Mexico

Mexican lender Banco Mercantil del Norte (Banorte) is looking to sell its third Swiss franc bond, breaking a two-week hiatus in cross-border issuance from Latin American borrowers.

Mexican leasing company Unifin issued $200m of three year debt via a private placement this week on the back of reverse inquiry from an institutional investor.

As Latin American bonds suffer from broader market volatility, potentially closing the primary market window to riskier names, Fitch said on Monday that Mexico’s budget would be strained in the face of weak growth and lower oil revenues.

Swiss firm responsAbility Investments has closed a $175m microfinance CLO via JP Morgan, revitalising an industry which last saw issuance before the financial crisis.

Mexico responded to the lower rates environment on Tuesday with an opportunistic $3.56bn liability management exercise, shrugging off any credit worries to issue at a very slim concession.

Mexico showed that even trickier credit stories could take advantage of the borrower-friendly rates environment, surprising many with a $3bn liability management exercise just two weeks after finance minister Carlos Urzúa resigned.

Debt capital markets bankers say more Mexican companies could rush to bond markets, as strong conditions for issuance outweigh the increasing concerns surrounding the direction of the country's economy.

Mexican leasing company Docuformas offered a double-digit yield on its return to bond markets but was able to issue twice the amount of its last deal, offering its first index-eligible bond in the process.

Real estate investment trust (Reit) Fibra Terrafina sold $500m of 10 year bonds on Monday, with hefty tightening allowing the borrower to price closer to its largest Mexican rival than expected.

Debt capital markets bankers covering Mexico do not expect the resignation of finance minister Carlos Urzúa on Tuesday to affect incoming bond issues though they acknowledge that his departure could create uncertainty.

Two Mexican companies announced bond roadshows on Monday, in combination with buybacks of 2022 notes, as Latin American borrowers continue to try to use liability management to take advantage of low rates to refinance debt.

Two Latin American companies announced bond roadshows this week, with a third launching a tender that will require a new issue, as the region’s issuers flock to the low rate environment and gradually rehabilitate disappointing issuance volumes.