Latin America Bond House: Bank of America

IFR Awards 2021
4 min read
John J. Doran

Maintaining the edge

Bank of America arranged the highest volume of Latin America bond deals in the lead-left position in 2021, continuing to showcase its expertise in deals for sovereigns, financials and liability management offerings. For maintaining its edge in the region, Bank of America is IFR’s Latin America Bond House of the Year.

A raft of bond issues from sovereigns to corporations kept Bank of America busy in 2021, with many issuers still grappling with the impact of the coronavirus pandemic and the changes it wrought.

The bank's financing efforts were supported by dedicated teams who focused on covering Mexico and Brazil, and other teams focusing on all other regional issuers, as well as liability management and ESG financing.

The bank held the number one position in the lead-left league table for LatAm bonds, with 14 offerings totalling US$8.32bn for a 5% market share, according to Refinitiv data. It was second in the overall US dollar LatAm league bond tables with US$14.53bn of credit from 53 issues.

The bank built on the top spot it achieved in 2020 as lead-left bookrunner when it boasted five offerings totalling US$4.52bn for a 2.7% market share during the height of the pandemic. The previous time it held the number one lead-left spot was in 2013, according to Refinitiv data.

The year started with BofA working as joint bookrunner on a US$1.1bn offering from e-commerce and fintech giant MercadoLibre. The deal was the first high-yield sustainability bond from Latin America and the company’s debut bond. BofA ended the year as lead-left bookrunner on a critical Pemex liability management exercise that provided key government support and debt relief to Mexico’s oil and gas company.

The US$1bn offering was the company's first issuance since 2019. Mexico said it would provide US$3.5bn of cash for the LM programme and ensured budgetary allocations for additional capital injections to cover payments for maturities in 2021 through to 2023.

Maxim Volkov, BofA's head of Latin America DCM, said: “As a result, and in conjunction with a carefully designed comprehensive financial and business strategy, Pemex’s secondary spreads tightened by more than 100bp across the curve, leaving the company in position to not have to access the capital markets in the short to mid-term.”

In between, the bank juggled more inaugural offerings for US dollar and euro bonds, ESG financings and liability management exercises for sovereigns and corporations.

In March, BofA acted as global coordinator for a US$4bn three-tranche trade for Peru. BofA was also global coordinator in November for the nation’s first social euro bond under its Sustainable Bond Framework adopted in July.

The SEC-registered €1bn 15-year bond diversified Peru’s investor base and will fund a variety of eligible social projects, including support for vulnerable groups and affordable housing.

In April, Colombia sold its largest transaction ever in the international debt markets with a US$3bn two-tranche issue with BofA as joint bookrunner. And in September Guatemala achieved its lowest coupon on an offering in the international debt markets for a 12-year US$500m tranche sold as part of a US$1bn offering sole managed by BofA.

BofA was very active in the green and sustainability arenas, working on several issues including for Suzano and B3 of Brazil, Sociedad Quimica y Minera de Chile and Mexico's Metalsa.

BofA also worked on dollar debuts for Alsea, a US$500m five-year note, and Banco de Chile’s US$500m 10-year issue.

Key liability management offerings were among the highlights for BofA. Panama’s Aeropuerto Internacional de Tocumen’s US$1.855bn new money and LM bond allowed the airport to improve its debt structure and provide for a Covid-19 fund to support its operations.

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