Brasília – The National Treasury disclosed the final results of the sale of Brazilian foreign debt bonds entitled Global 2041 Republic Bonds, maturing January 7th, 2041. A total of US$ 500 million were sold on the European and North American markets, and US$ 50 million on the Asian market.
Investors who purchased the Brazilian bonds in this operation will have annual rates of return of 5.202% – considered the lowest rate ever for bonds denominated in dollar maturing in 30 years. Whenever the rate drops, it means that foreigners are more confident in Brazil, and thus do not need to raise the cost of the bond as a measure against risk.
That same confidence also led the demand for Brazilian bonds to increase. The issuance was led by the HSBC, Itaú, BB Securities and BNP Paribas banks. The funds will become part of the country’s foreign reserves on the 2nd next month.
For bonds maturing in 30 years, the lowest rate thus far had been 5.8% a year, obtained in an issuance that raised US$ 1.275 billion in 2009. The lowest rate ever was 4.547% a year, as US$ 825 million were raised in July this year, but the bonds matured in ten years.
The government sells foreign debt bonds when it needs, among other things, to postpone the payment of some of the debt, or set a reference for the value of government bonds, and of Brazilian companies’ bonds abroad.
*Translated by Gabriel Pomerancblum
