League tables

No longer at the centre of the financial crisis as in times past, Latin America has been relatively resilient amid the storm generated by the US credit crisis. On the contrary, the region has been seen as a sort of safe haven, given the strong fundamentals, deepening local markets and upward ratings trajectories in countries like Brazil, Peru and Colombia. But this decoupling theory could start to look flimsy as the situation in the US goes from bad to worse; and it will be put under even more strain in coming months. The relative value...

Investors are flocking to Latin America like never before. But while prospects are very good for the longer term, the short term may provide a bumpier ride, warned Ricardo Maxit, founding partner of Copernico Capital Partners, the Argentine hedge fund group. Maxit believes the popular theory of decoupling between Latin American markets and those of the US and Europe is exaggerated. Money is likely to be reallocated to North America as the markets there continue to be hit and valuations look increasingly attractive, which is likely to hurt South...

A loose US monetary policy combined with a tightening – or neutral – bias in many EM countries mean the carry trade is alive and well. And with more and more money flowing into what is still a nascent asset class, technicals look strong not only for LatAm, but other EM local currency markets. "You have a decoupling [in local markets] that investors recognise. Emerging economies are not necessarily tied into the subprime mess, though you do have spillover," said one US investor. "There are good performing countries. Colombian pesos, Peruvian...

Over the last few years bankers have pinned their hopes on – and funnelled resources into – what had been expected to be a burgeoning high-yield market in Latin America. But with investors retreating from all but the best credits and blue chip names reluctant to pay new issue premiums, DCM officials are expecting a slow year ahead. As of early March, Latin America had seen just three corporate issues worth US$1.25bn in total, mostly comprising deals from investment-grade names such as Petrobras and Usiminas. That compares to corporate...

Reality and opinion are hurtling in two very different directions when it comes to sizing up the prospects of Brazil's debt capital markets. On paper, the market is on course for a banner year, with more than US$50bn of issuance expected. The bulk will come from debentures and the rest from ABS, if the market keeps up its present pace. Against a backdrop of Brazilian inflation and GDP expectations of 4.5% for both categories in 2008, it hardly seems surprising that the local market is projected to do so well. Debt issuance has already seen...

The landscape for the Latin American loan market remains relatively benign and is one of the few seeing any real activity this year. Yet volumes have declined considerably as the subprime crisis has taken its toll on banks' balance sheets, and the situation could get worse before it gets better. Back of the envelop calculations put volumes during the first quarter at around US$6.4bn, including some larger blue chip and commodity based transactions – such as Votorantim's US$1.3bn three-year, a US$1.2bn senior credit facility from Usiminas, a...

As usual the slowdown was as intense as the acceleration. After three years in which deals jumped from 15 in 2004 to 72 last year, Brazil's equity markets have struggled in 2008, just a couple of sizeable deals have priced so far. Receding liquidity has changed the landscape. From the beginning of Brazil’s IPO boom, the biggest driver for deals was foreign capital: overseas investors snapped up 75.4% of all the equity offerings between 2004 and 2007. So when the US subprime crisis hit and investors retrenched, they took with them a lot of the...

Latin America can crudely be divided into socialist and free-market camps and the financing of infrastructure projects is primarily a product of a country’s politics. The left-leaning block – including Venezuela, Argentina, Ecuador and Bolivia – see infrastructure as a necessity which it is the state’s duty to provide. The government therefore retains maximum control of the provision of all roads, railways, water, sewage systems and power. Conversely, in Brazil, Chile, Peru, Mexico and Columbia there has been an increasing acceptance that the...

As on so many other fronts, Latin America has huge untapped potential when it comes to environmental financing. The Southern Cone is especially well positioned to capitalise, using mostly clean hydroelectric power and being home to both the largest tropical forest and the most important fresh water complex in the world – the Amazon and the Guarani Aquifer systems. Most of the projects related to conservation are still funded with government and multilateral money. Carbon credit generation and marketing is incipient and has potential to mature...

As Mexican and Brazilian markets increase in depth and maturity, one of the biggest beneficiaries has been the real estate sector. Homebuilders in Brazil have tapped the equity markets at previously unseen rates, and within three years the sector went from being nonexistent to becoming the single biggest in Bovespa. The Brazilian stock market as 26 real estate companies listed. In Mexico the driver was the debt market. RMBS issuance went from US$53m in 2003, when the first transaction priced in the local markets, to US$3.1bn last year. Yet...

An overhaul of local accounting; a dramatic speed-up in debt and equity transaction approvals; and a crackdown on market misbehaviour: just some of the core goals facing one of the world's toughest regulators this year. Third parties are pulling Brazil’s local debenture and ABS markets in different directions in their attempts to revive them. For Sergio Weguelin, commissioner of Brazil's Comissao de Valores Mobiliarios, these challenges represent business as usual as Brazil continues to embrace modern global practices, further distancing itself...

This year is expected to be Banco Bradesco's (BBI) best yet, assuming markets improve, as it finalises its key integration process, started in mid-2005 when competitors were revelling in the nation's biggest private-sector bank's absence from core investment banking markets. Key to these changes is Denise Moura, head of investment banking, who opens doors and has the ear of CEOs and CFOs across the land. For the most senior woman in Brazilian investment banking – and the previous head of the nation's second biggest private-sector asset...