Dominican Govt. issues US$1.82B bond

Santo Domingo.- The Dominican government issued US$1.0 billion of debt at 30 years and, for the first time, a bond in Dominican pesos for RD$40.0 billion (US$822.0 million), the Finance Ministry announced Thurs.

“The Caribbean sovereign set final yields of 8.90% on a DOP40bn (US$817m) five-year tranche and 6.50% on a US$1bn 30-year,” Nasdaq reports quoting a Ministry source.

According to Finance, “the Dominican Republic made history in the global capital market by placing, for the first time in the New York market, a bond denominated in local currency for 5 years for RD$40.0 billion (US$822.0 million), and a bond in US$ at 30 years for US$1.0 billion at the lowest coupon rate issued by the country for this term.”

Nasdaq reports that expected ratings on the 144A/Reg S trade are Ba3/BB-/BB-. “Proceeds will be used for general purposes, including the partial financing of the 2018 budget.”

“Citigroup and JP Morgan are bookrunners, while Banreservas (State-owned bank, is co-manager.”

The issuance of the Dominican peso bond “is part of the strategy of the Dominican Government to continue reducing the exposure to foreign exchange variation and is the first made by a country in Latin America not classified as an investment grade.” The placement was made at an interest rate or coupon on the peso bond of 8.90%.