The National Treasury announced this Monday (9) the result of the first issue of sovereign bonds on the international market in 2026.
The operation, carried out in the United States, generated US$4.5 billionwith the issuance of a new ten-year bond – the Global 2036 – and the reopening of the Global 2056 bond, with a 30-year term.
Due on May 22, 2036, the Global 2036 was issued in the amount of US$3.5 billion, a record volume for ten-year National Treasury papers, with interest of 6.4% per year, that is, paying 6.4% per year to investors. In addition, there is a coupon of 6.25% per year to be paid semi-annually, in May and November.
The bond had a spread 220 basis points (2.2 percentage points) above the U.S. Treasury bond. Both interest rates and spreads function as a measure of the risk of Brazilian securities abroad. The lower it is, the lower the chances of the country defaulting on its external public debt.
Interest rates were higher than in the previous issue of ten-year bondsheld in November. At the time, the Treasury obtained interest of 6.2% per year. In relation to the spread, the difference was also greater than the 210.9 points (2,109 percentage points) recorded in November.
Global 2056
In relation to the 30-year paper, Brazil raised US$1 billion maturing on January 12, 2056. The paper will pay interest of 7.3% per year, a coupon of 7.25% per year and a spread of 245 basis points (2.45 percentage points) over the 30-year US Treasury paper.
According to the Treasury, the spread was the lowest for a 30-year Brazilian bond on the international market since July 2014 (187.5 basis points). Compared to the previous issue of Global 2056, which took place in September last year, both interest rates and spreads fell. At the time, the Treasury achieved interest of 7.5% per year and a spread of 252.7 points.
Demand
According to the National Treasury, the operation had demand 2.7 times greater than the volume offeredwith the order book (which measures investor interest) reaching approximately US$12 billion. In relation to Global 2036, the total raised was the largest for international ten-year bonds since the start of issuances abroad by the Brazilian government.
“The results with high demand, high volume and low spreads demonstrate investors’ confidence in the robustness and attractiveness of Brazilian sovereign debt, reflecting the international market’s favorable perception of the country’s credibility”, highlighted the Treasury in a note.
The operation was coordinated by banks HSBC, JP Morgan, Santander and Sumitomo. The US$4.5 billion raised this Monday will be incorporated into Brazil’s international reserves on February 19.
