The Debt Management Unit of the Ministry of Economy and Finance (MEF) and the Central Bank of Uruguay (BCU) they made this week ua special operation in the local market, which included the issuance of Treasury note in Uruguayan pesos, indexed units and pension units, and title exchange from the government and BCU.
Weights and Indexed Units
The operation that had the participation of institutional investors and also retailers began on Monday with the reopening of the UI Note maturing in January 2029. The bid was for 700 million UI (about US$100 million) and offers were received for US$269 million. They were finally awarded $201 million with an annual cut rate of 3.1%.
The authorities have the power to accept up to twice the amount tendered, to the extent that the demand is high and the return requested by investors is convenient. That was the option taken in this case.
For its part, on Tuesday the reopening of the bond in nominal pesos maturing in February 2029. The amount tendered was $4,000 million (US$102.5 million) and there were offers for US$231 million. The authorities awarded an amount of US$ 107 million at a rate of 10.38% per year. The previous placement of this series last month had been with a yield of 10.49%.
Social Security Units
The operation continued on Thursday with the note in UP with expiration in May 2040. It was tendered for 4,100 million UP (US$148.5 million), there were offers for US$402 million, and the MEF authorities awarded the maximum allowed (US$297 million) with an annual interest rate of 2.11%.
Finally, this Friday the note in UP maturing in September 2047. The base amount was 4,100 million UP (US$148.5 million), there was demand for US$350 million and they were awarded $297 million, also double the amount originally bid. These titles were yielding 2.14%.
The operation allowed investors the option of paying for their new titles by delivering pesos, dollars, or exchanging them for other outstanding titles. with maturities between 2023 and 2025. Initially, the total base amount of the operation was US$500 million, but it finally amounted to around US$902 million.
Of the total amount of titles issued, a 77% was integrated with BCU Bills and short-term Government Treasury Notes, and the remaining amount (23%) It was paid in cash (pesos and dollars).
As on other occasions, the operation helped the government cover the needs of financing for 2023clear short-term maturities and continue to develop the market in national currency.
