(Adds details of road show, quote from finance minister,
By Luc Cohen
BUENOS AIRES Jan 12 Argentina clinched an
18-month financing deal worth $6 billion with six banks on
Thursday, Finance Minister Luis Caputo told reporters, saying
the government planned to tap international capital markets for
$10 billion in 2017.
Sovereign bond issuance will start on Jan. 19, with a sale
of $3 billion to $5 billion in U.S. dollar-denominated paper.
The sale will kick off an international financing program
under which Argentina expects to sell $7 billion of dollar bonds
and $3 billion of bonds in other currencies, Caputo told a news
conference. He did not discuss specifics about bond maturities
or interest rates.
Argentina also plans nearly $4 billion in multilateral
borrowing from institutions including the World Bank and
Inter-American Development Bank.
"It's very positive news for us," Caputo said of the bank
financing agreement, which he added would be backed by the
country's Bonar 24 bonds. The repo deal was priced at three
month Libor plus 290 basis points.
The six banks chosen for the repo deal and dollar bond sale
were Santander, BBVA, Citibank,
Deutsche Bank, HSBC and JP Morgan.
Argentina also plans on Jan. 19 to sell $1 billion to $2
billion equivalent of peso-denominated debt subject
to local law, Caputo said. The sale will be part of a program in
which the government plans to issue $14 billion equivalent of
peso-denominated obligations in 2017.
He will start a three-day road show on Monday in London,
followed by meetings with investors in Boston, Los Angeles and
"Sustainability is far from being a problem," Caputo said
referring to Argentina's ability to repay, in a preview of his
sales pitch to prospective bond buyers.
He took office this year after President Mauricio Macri
fired former Finance Minister Alfonso Prat-Gay.
Macri split the ministry into a finance ministry led by
Caputo responsible for sovereign debt management, and a treasury
ministry led by economist Nicolas Dujovne responsible for fiscal
policy. Caputo had been finance secretary under Prat-Gay.
Argentina's central bank kept its policy rate unchanged at
24.75 percent on Tuesday. Inflation last year was about 40
percent with the economy in recession. Growth is expected to
resume this year and the bank has an inflation target of 12 to
17 percent, though economists expect it to exceed 20 percent.
(Reporting by Luc Cohen; Editing by Peter Cooney and Phil