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Bond Market News
Colombia Purchases $9.3bn in Assets for Collateral To Secure Swap Deal
September 11, 2025
Colombia has purchased about $9.3bn in assets, including its own offshore bonds, local debt, and US Treasuries, to be used as collateral in a series of complex swap transactions. The move is part of an unconventional debt-management strategy that has recently involved bond buybacks, a eurobond issuance, and Swiss franc-denominated swaps. In one deal, banks repurchased $5.4bn of Colombia’s dollar bonds through a tender offer tied to a government total return swap. The strategy has boosted investor sentiment, however, risks remain. Fiscal pressures are said to be mounting as President Gustavo Petro increases spending in his final year, and Colombia’s credit rating was downgraded by S&P and Moody’s earlier in 2025 after the government abandoned its fiscal rule. The sovereign is currently rated Baa3/BB/BB+ (Moody’s/S&P/Fitch).
Colombia’s dollar bonds have been on an upward trend, and have returned nearly 6-9% in the past month as seen in the chart above.
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