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UPDATE 1-Jamaica sets stage for possible bond market return
June 4, 2014 / 9:16 PM / 3 years ago

UPDATE 1-Jamaica sets stage for possible bond market return

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By Davide Scigliuzzo

NEW YORK, June 4 (IFR) - Jamaica appears to be nearing a much-awaited return to the international capital markets after being forced into two domestic debt restructurings over the last four years.

The Caribbean island, rated Caa3/B-/B-, has hired Citigroup to arrange a roadshow in the United States and Europe.

While the meetings are officially unrelated to a new bond issue, expectations that a deal will follow are running high among some of the investors who plan to attend.

“Jamaica has done very well this year,” said one. “They have implemented a massive fiscal adjustment program and they are running close to a balanced budget. I think there could be a deal after this.”

While the sovereign’s refinancing requirements are modest this year - it only has a 10.5% 150m note maturing in October - a successful bond offering would be seen as a important milestone in the island’s economic adjustment program.

“It wouldn’t surprise me if they did (a deal),” said a second investor, who reckons the sovereign could probably print a new 10-year issue with a yield in the high 7%s.

Jamaica’s 9.25% 2025 notes were spotted trading at a bid yield of 7.34% on Wednesday afternoon.

A potential deal would come hot on the heels of an IMF program and a domestic debt restructuring that has helped the country get back on its feet after suffering a painful economic recession earlier this decade.

Jamaican officials will meet investors in Los Angeles on June 10 and 11, New York on June 12, Boston on June 13. They will travel to Europe the following week, visiting accounts in London on June 16, Germany on June 17, and Amsterdam and Zurich on June 18.

Reporting by Davide Scigliuzzo; Editing by Paul Kilby

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