The MasterBlog: Exprinter Sells $626 Million of Notes Linked to Venezuela Debt - BusinessWeek
Subscribe to The MasterBlog in a Reader Subscribe to The MasterBlog by Email

MasterBlogs Headlines

Saturday, September 4, 2010

Exprinter Sells $626 Million of Notes Linked to Venezuela Debt - BusinessWeek



Exprinter Sells $626 Million of Notes Linked to Venezuela Debt
Bloomberg
September 03, 2010, 10:09 AM EDT
Sept. 3 (Bloomberg) -- Exprinter International Bank NV in the Netherlands Antilles sold $626 million of structured notes linked to Venezuelan bonds, perceived by investors as the riskiest debt in the world.
The notes, issued in six parts, are tied to the performance of Venezuela government debt including bonds of state-owned oil company Petroleos de Venezuela, according to data compiled by Bloomberg. The biggest portion is a $271 million issue of 20- year notes issued at 66.5 percent of face value yielding 14.5 percent. That compares with 15.2 percent on the underlying government bonds.
Credit-linked notes pay interest based on the price of the entities they reference and are usually bought by investors who aren’t able to trade the underlying securities because of regulations, cost or other reasons. Exprinter, based on the Caribbean island of Curacao, issued nine structured notes linked to Venezuela this year, Bloomberg data show.
Robin Powers, a U.S.-based lawyer at Rimon Law representing Exprinter, said the bank declined to comment on the deals.
The cost of insuring Venezuelan debt for 10 years with credit-default swaps jumped 17 percent this year to 1,120 basis points, the highest in the world ahead of Greece and Argentina. The contracts indicate a 78.4 percent probability of default on 10-year Venezuelan debt, according to data provider CMA.
Credit-default swaps are used to bet on or hedge against a borrower’s ability to repay debt. An increase indicates deterioration in the perception of credit quality. A basis point on a contract protecting $10 million of debt is equivalent to $1,000 a year.
Venezuela is rated BB- by Standard & Poor’s, three levels below investment grade, and two steps lower at B2 by Moody’s Investors Service.
The country’s economy shrank for a fifth quarter in the three months to June 30, making it the only Latin American country still in recession. Gross domestic product shrank 1.9 percent in the second quarter, and 3.5 percent in the first half.
--Editors: Andrew Reierson, Paul Armstrong
To contact the reporter on this story: Sarfraz Thind in London at Sthind3@bloomberg.net
To contact the editor responsible for this story: Paul Armstrong at Parmstrong10@bloomberg.net


Exprinter Sells $626 Million of Notes Linked to Venezuela Debt - BusinessWeek

Share this|
________________________
The MasterBlog

No comments:

Post a Comment

Commented on The MasterBlog

Tags, Categories

news United States Venezuela Finance Money Latin America Oil Current Affairs Middle East Commodities Capitalism Chavez International Relations Israel Gold Economics NT Democracy China Politics Credit Hedge Funds Banks Europe Metals Asia Palestinians Miscellaneous Stocks Dollar Mining ForEx Corruption obama Iran UK Terrorism Africa Demographics Government UN Living Bailout Military Russia Debt Tech Islam Switzerland Philosophy Judaica Science Housing PDVSA Revolution USA War petroleo Scams articles Fed Education France Canada Security Travel central_banks OPEC Castro Nuclear freedom Colombia EU Energy Mining Stocks Diplomacy bonds India drugs Anti-Semitism populism Arabs Brazil Environment Irak Saudi Arabia elections Art Cuba Food Goldman Sachs Syria Afghanistan Hamas Lebanon Silver Trade copper Anti-Israel Egypt Hizbollah Madoff Ponzi Warren Buffett press Aviation BP Euro FARC Gaza Honduras Japan Music SEC Smuggling humor socialism trading Che Guevara Freddie Mac Geneve IMF Spain Turkey currencies violence wikileaks Agriculture Bolívar ETF Restaurants Satire communism computers derivatives Al-Qaida Bubble FT Greece NY PIIGS Republicans Sarkozy Space Sports BRIC CITGO DRC Flotilla Germany Globovision Google Health Inflation Law Libya Mexico Muslim Brotherhood Nazis Pensions Peru Uranium cnbc crime cyberattack fannieMae pakistan stratfor Apollo 11 Autos BBC Bernanke CIA Chile Climate change Congo Democrats EIA Haiti Holocaust IFTTT ISIS Jordan Labor M+A New York OAS Philanthropy Shell South Africa Tufts Ukraine bitly carbon earthquake facebook racism twitter Atom BHP Beijing Business CERN CVG CapitalMarkets Congress Curaçao ECB EPA ETA Ecuador Entebbe Florida Gulf oil spill Harvard Hezbollah Human Rights ICC Kenya L'Oréal Large Hadron Collider MasterBlog Morocco Nobel Panama Paulson RIO SWF Shiites Stats Sunnis Sweden TARP Tunisia UN Watch Uganda VC Water Yen apple berksire hathaway blogs bush elderly hft iPad journalism mavi marmara nationalization psycology sex spy taxes yuan ALCASA ANC Airbus Amazon Ariel Sharon Australia Batista Bettencourt Big Bang Big Mac Bill Gates Bin Laden Blackstone Blogger Boeing COMEX Capriles Charlie Hebdo Clinton Cocoa DSK Desalination Durban EADS Ecopetrol Elkann Entrepreneur FIAT FTSE Fannie Freddie Funds GE Hayek Helicopters Higgs Boson Hitler Huntsman Ice Cream Intel Izarra KKR Keynes Khodorskovsky Krugman LBO LSE Lex Mac Malawi Maps MasterCharts MasterFeeds MasterLiving MasterMetals MasterTech Microsoft Miliband Monarchy Moon Mossad Mugabe NYSE Namibia Nestle OWS OccupyWallStreet Oman PPP Pemex Perry Philippines Post Office Private Equity Property Putin QE Rio de Janeiro Rwanda Sephardim Shimon Peres Stuxnet TMX Tennis UAV UNHRC VALE Volcker WTC WWII Wimbledon World Bank World Cup ZIRP Zapatero airlines babies citibank culture ethics foreclosures happiness history iPhone infrastructure internet jobs kissinger lahde laptops lawyers leadership lithium markets miami microfinance pharmaceuticals real estate religion startup stock exchanges strippers subprime taliban temasek ubs universities weddimg zerohedge

Subscribe via email

Enter your email address:

Delivered by FeedBurner

AddThis

MasterStats