Thursday, october 1, 2020

Ministry of Finance announces debt financing plan for 2020Q4

In order to cover above-the-line budget financing needs, the Ministry of Finance plans on issuing approximately US$950 million in local currency Treasury Bonds during the fourth quarter of 2020. This amount is part of the US$12.9 billion 2020 annual issuance plan, set within the amount approved by Congress. Treasury bond issuances in local and foreign currencies totaled approximately US$11.95 billion during the first three quarters of the year.  

During the first three quarters of the year, local currency issuances were concentrated in short-term bills and bonds due in 2025. The issuance plan for the fourth quarter considers the issuance of bonds due in 2025, and new benchmark local currency bonds due in 2028 and 2033. In line with the debt management strategy implemented in previous years geared towards strengthening benchmark bonds, the Ministry of Finance also plans on issuing local currency bonds that mature in 2028 and 2033 during 2021. 

In addition, the Ministry of Finance will continue to implement liability management operations. The Ministry of Finance, through its Treasury, offers the option to repurchase Treasury Bonds already issued and previously allocated (Old Bonds) in exchange of cash, or to be exchanged for New Treasury Bonds (New Bonds). These operations are not considered within the annual debt issuance limits authorized by Congress. 

Furthermore, amortizations of the bills due in November and December 2020 for approximately USD1.35 billion will be financed by the issuance of local currency bonds maturing in years 2028 and 2033.

The calendar of the operations to be carried out during the fourth quarter of 2020 will be appropriately informed prior to their eventual execution, whether through the Open Market Operations System of the Central Bank of Chile and / or in operation(s) through the book-building system with simultaneous offers in the local and international markets.

All this information could be subject to modifications in the event of significant changes in market conditions and / or in the financing needs of the government. If this were to occur, it will be appropriately informed. 


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