Chile issues social bonds for US $ 1,300 million in local currency

The Chilean Ministry of Finance reported Thursday that issued Treasury bonds by 1’061,000 million pesos, equivalent to approximately US $ 1.300 million under the financing plan for the year 2021 and using the available remaining margin indebtedness of the budget law for this year.

The bond is denominated and payable in Chilean pesos maturing on 1 June 2024 and obtained a demand of approximately 3,710 million, and 2.9 times as awarded, explained the Ministry of Finance said in a statement.

The rate obtained was 5.70% (coupon rate of 5.8%). The spread is equivalent to a concession of 15 basis points in relation to the value estimated with information from the secondary market, added the official information.

It is a social bond in which national and foreign investors could participate simultaneously, the Ministry of Finance detailed in a statement.

Considering current market conditions, the Secretary of State explained that it decided to go to the financial markets and not contract obligations with multilaterals for that amount, as was originally planned.

Thus, Chile completed the borrowing plan for the year 2021 a total of US $ 28.991 million, of which approximately US $ 15.754 million were bonds in foreign currencies, US $ 700 million credit with multilateral and US $ 12,537 million in local currency.

“Today’s operation reaffirms Chile’s leadership in the thematic bond market, being the first country in the American continent to issue green bonds in 2019 and, since 2020, has also expanded the set of debt instruments with the issuance of social and sustainable bonds, including debt denominated in pesos”, Said the Ministry.

Considering today’s operation, it has been issued since 2019 the equivalent of approximately US $ 27,000 million in thematic bonds, of which US $ 17.800 million are social bonds, US $ 7,700 million are green bonds, and US $ 1,500 million are bonds sustainable.

After this last operation, thematic bonds represent 25.4% of the Central Government’s debt stock, a percentage that is among the largest in the world, according to official information.