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Ecuador is preparing to return to international debt markets for the first time since 2019, hiring banks to coordinate roadshows, as per sources. The government plans to sell USD-denominated bonds to fund a buyback of its notes due in 2030 and 2035, whilst aiming to improve its debt profile and reduce medium-term debt service pressures. Bloomberg notes that the potential deal coincides with an EM bond surge, with sovereign sales up 73% compared to last year. Ecuador’s Finance Minister Sariha Moya expects the new bonds to yield less than 10%, noting that its current dollar notes trade between 7-9%. Sources note that their reaccess to markets follows a successful reform program and a prior $17.4bn restructuring during the pandemic. With $900mn in debt payments due this month, Ecuador remains open to additional financing options, including debt-for-nature swaps and multilateral guarantees from the World Bank and IDB.
Ecuador’s dollar bonds were trading higher across the curve. For instance, its 6.9% 2030s were up by 1.6 points to 99.5, yielding 7.2%.
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