Colombian Swaps Short-Dated Bonds
In May, Colombia swapped $600 million in dollar-denominated
short-dated bonds for longer-dated Colombian peso bonds to
improve the maturity profile of its public debt. The government
also set out to reduce its currency and refinancing risk by
converting dollar debt into local currency debt. The exchange
was originally planned for $250 million, but later more than
doubled to $600 million. The transaction lengthened Colombia's
debt profile to 6.3 years from 6.18 years previously.
In May, the International Finance Corporation (IFC), the
private sector arm of the World Bank, invested $2.2 million in
mortgage-backed securities issued by Colombian secondary
mortgage market company, Titularizadora Colombiana. It issued
securities with five- 10- and 15-year tranches for a total of
$212 million. The bonds yield 4%, 5.41% and 6.05%, respectively
and were sold primarily to local pension funds and banks. The
IFC provided a credit enhancement facility...
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