Chile is tapping dollar debt markets for the first time this year as it seeks to swap out old bonds for new sustainability-linked securities.
(Bloomberg) — Chile is tapping dollar debt markets for the first time this year as it seeks to swap out old bonds for new sustainability-linked securities.
The South American nation sold $1.15 billion of notes due in 2036 and $1.1 billion of bonds due 2054, yielding 123 and 148 basis points over US Treasuries, respectively, according to a person familiar with the matter, who asked not to be identified because they’re not authorized to speak on the record. That’s lower than the initial price talk.
The country is also offering to exchange existing, non-ESG foreign bonds due between 2025 and 2047 for the new notes, according to a statement from the government on Tuesday. Chile intends to keep the offer open for at least five business days.
Read more: Chile Banks Pile Through Debt Sale Window Almost Before It Opens
Such a swap would replace a portion of the nation’s outstanding non-ESG bonds with notes that are directly linked to social and environmental goals. It’s an indication that Chile, which became the first country in the world to sell sustainability-linked bonds in 2022, is looking to keep building its reputation in the fast-growing ESG debt market.
The new bonds due in 2036 and 2054 stand to see their coupons increase if the nation is unable to meet certain thresholds connected to greenhouse gas emissions and the number of women on company boards.
The bookrunners for the new issuance are Credit Agricole CIB, HSBC, Santander, Scotiabank and Societe Generale.Â
Finance Minister Mario Marcel, meanwhile, is in New York Tuesday for investor meetings.
–With assistance from VinÃcius Andrade.
(Updates with pricing in second paragraph.)
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