The Inter-American Development Bank has issued its first
inflation-linked bond denominated in Brazilian currency. The
issue of 200 million reais (approximately
$73,000,000) matures on Dec. 8, 2009. The
issue was priced on Dec. 7 at 100 percent and will pay a coupon
of 6.26 percent. The principal will be adjusted to
ABN AMRO is the lead manager of the issue, which is targeted
to international institutional investors and is subject to
selling restrictions in Brazil.
The bond is the fourth IDB issue in a Latin American currency.
The IDB earlier this year issued a bond in Brazilian reais as
well as issues in Colombian and Mexican national
The latest issue was well received by the market, satisfying
global demand for Brazilian reais assets.
The proceeds were swapped into U.S. dollars by the IDB and
will be used to help finance the Banks lending
program for the economic and social development of Latin
America and the Caribbean. The IDBs borrowing program
in 2004 is expected to be about $5 billion.
This year the Bank for the first time issued bonds in Latin
American currencies in order to take advantage of favorable
market opportunities and a growing maturity and depth in
regional financial systems.