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200 | <s>[INST] Charlotte N.C.-based NationsBank, the nation's third-largest bank, sold [/INST] its first credit-card certificates through underwriters led by its NationsBanc Capital Markets Inc. unit. </s> |
201 | <s>[INST] The three-year maturity was increased by $250 million to $750 [/INST] million because of particularly heavy orders for that segment, said John Griff, managing director of NationsBanc's debt-financing group. </s> |
202 | <s>[INST] Overall, investors were "a healthy [/INST] mix of insurance and total return-oriented accounts," he added. </s> |
203 | <s>[INST] Jeffrey Salmon, associate at J.P. Morgan Securities Inc., said [/INST] NationsBank's choice of a 10-year maturity was "bold" for a first-time issuer in that asset-backed market sector. </s> |
204 | <s>[INST] The $750 million senior three-year portion was priced as [/INST] 4.75% at 99.9063 to yield 4.83%, which was 38 basis points above three-year Treasury notes. </s> |
205 | <s>[INST] The $500 million senior 10-year portion was priced [/INST] as 6% at 99.1719 to yield 6.19%, 55 basis points above comparable Treasurys. </s> |
206 | <s>[INST] ___ Document 135 of 400 Bond offering by Argentina sets precedents [/INST] Author: Vogel, Thomas T, Jr Publication info: Wall Street Journal , Eastern edition [New York, N.Y] 09 Dec 1993: PAGE C1. </s> |
207 | <s>[INST] accountid=28034 Abstract: Argentina's $1 billion global-bond offering on [/INST] Dec 8, 1993 illustrates how far the world's investors will stretch for a yield today. </s> |
208 | <s>[INST] While global bonds have been dominated by blue-chip [/INST] issuers, Argentina's offering is the first issue of junk bonds to crack that elite club. </s> |
209 | <s>[INST] In the US, the benchmark 30-year [/INST] Treasury bond was unchanged at 101 2/32 to yield 6.16%. </s> |
210 | <s>[INST] Full text: NEW YORK -- If a single deal could [/INST] illustrate how far the world's investors will stretch for a yield today, Argentina's $1 billion global-bond offering is it. </s> |
211 | <s>[INST] Global bonds, which are issued simultaneously in all the [/INST] world's major markets, until now were dominated by blue-chip issuers, such as the World Bank. </s> |
212 | <s>[INST] Argentina's offering, launched yesterday and increased in size from [/INST] $750 million on brisk demand, is the first issue of junk bonds to crack that elite club. </s> |
213 | <s>[INST] It also sets other precedents: It [/INST] is the first global-bond offering from a Latin American nation. </s> |
214 | <s>[INST] More importantly, it may be the first Latin American bond offering from [/INST] a nation other than Mexico to be widely embraced by investors who don't specialize in developing nations, say money managers and underwriters. </s> |
215 | <s>[INST] The passage of the North American Free Trade Agreement has emboldened many investors [/INST] to look beyond Mexico to the securities markets of other Latin American countries -- including not only Argentina, but also Venezuela, Chile, Colombia and Brazil. </s> |
216 | <s>[INST] High coupons available in those bond markets are a [/INST] powerful lure for investors who are put off with puny yields in most industrialized nations. </s> |
217 | <s>[INST] With the benchmark 30-year U.S. Treasury bond yielding [/INST] just 6.16% yesterday, buyers are willing to take on greater risks to buoy their returns. </s> |
218 | <s>[INST] Demand for Argentina's offering "clearly illustrates that there is a whole new awareness of [/INST] investment opportunities in Latin America," says Wayne Lyski, executive vice president of Alliance Capital Management L.P., a mutual fund with extensive investments in Latin America. </s> |
219 | <s>[INST] Because Argentina's offering of noncallable 10-year [/INST] notes is global, final yields won't be set until today. </s> |
220 | <s>[INST] But the yield is likely to be set at 2.8 percentage points above [/INST] the U.S. Treasury's 10-year note -- or about 8.46%, says Philip D. Bennett, a director at Salomon Brothers Inc., one of the lead underwriters. </s> |
221 | <s>[INST] The bonds are rated single-B-1 by [/INST] Moody's Investors Service and double-B-minus by Standard & Poor's Corp. </s> |
222 | <s>[INST] Besides Salomon, Merrill Lynch & Co. and [/INST] Banco Rio de la Plata S.A. of Argentina led the underwriting. </s> |
223 | <s>[INST] Argentina's deal is only the latest in [/INST] a stream of global-bond offerings that have flooded the world's markets this year. </s> |
224 | <s>[INST] Since the World Bank launched the first global bond in 1989, dozens of [/INST] corporations and governments -- from Italy to Portugal, and from Matsushita Electric Industrial Co. to American Express Co. -- have jumped into the market. </s> |
225 | <s>[INST] So far this year alone, there have [/INST] been nearly 30 global offerings, the most ever, according to Salomon Brothers. </s> |
226 | <s>[INST] International finance experts say China, Mexico, Colombia, and [/INST] even Indonesia have lately approached the World Bank for advice about global-bond offerings. </s> |
227 | <s>[INST] Most global bonds outstanding are denominated in U.S. dollars, though [/INST] a number of big offerings of $1 billion or more have been denominated in yen and marks. </s> |
228 | <s>[INST] By selling notes in several markets at once, issuers tap [/INST] into broader demand and garner lower rates than they would get by selling in a single market. </s> |
229 | <s>[INST] Argentina, for example, may save as much as 0.20 to 0.30 percentage point in borrowing [/INST] costs by selling its notes globally, rather than in the European market where it placed bonds in the past, says Nikos Pappayliou, a portfolio manager at G.T. Capital Management. </s> |
230 | <s>[INST] According to Kenneth Lay, director of financial operations at the [/INST] World Bank, global notes are likely to become even more popular among buyers looking to invest in developing nations. </s> |
231 | <s>[INST] One reason is that mutual funds and other big [/INST] institutions often are restricted from buying such risky investments unless they meet certain eligibility standards. </s> |
232 | <s>[INST] "The incentive to go to the trouble to get a credit [/INST] qualified" as eligible is greater with global issues because they are very liquid, or easy to trade, says Mr. Lay. </s> |
233 | <s>[INST] Despite a history of debt defaults and hyperinflation, Argentina is getting the [/INST] benefit of the doubt from investors -- especially U.S. investors, who bought about half of yesterday's offering, according to Salomon's Mr. Bennett. </s> |
234 | <s>[INST] A stringent economic program constructed by Domingo Cavallo, the [/INST] nation's highly respected economic minister, has sharply reduced inflation and brought monetary and fiscal policy under control. </s> |
235 | <s>[INST] According to a preliminary prospectus, Argentina's annual [/INST] inflation rate plunged to 17.5% last year from 1,343.9% in 1990. </s> |
236 | <s>[INST] The liquidity of the notes sold yesterday were just the [/INST] thing to attract new investors in Argentina, says Ashwin Vasan, a portfolio manager at Oppenheimer Management Corporation. </s> |
237 | <s>[INST] Investors included corporatebond funds, pension funds and [/INST] perhaps even insurance companies, according to underwriters and other money managers. </s> |
238 | <s>[INST] While Oppenheimer already has other Argentine bond holdings, [/INST] it considered the global notes an important addition to its portfolio, says Mr. Vasan. </s> |
239 | <s>[INST] "It is going to [/INST] become the benchmark Argentine bond," he explained. </s> |
240 | <s>[INST] Mr. Vasan is counting on decent price appreciation [/INST] for all Argentine bonds thanks to favorable fallout from the passage of Nafta. </s> |
241 | <s>[INST] For example, many investors expect dollar-denominated Mexican debt to be [/INST] upgraded to investment status sometime in the first quarter of next year, says Mr. Pappayliou of G.T. Capital. </s> |
242 | <s>[INST] When that happens, Argentine bond yields are likely [/INST] to drop as much as 0.50 percentage point, thus benefiting investors who buy now. </s> |
243 | <s>[INST] Alliance's Mr. Lyski figures investors in Argentina should [/INST] look forward to the kinds of price gains that investors in Mexico have enjoyed. </s> |
244 | <s>[INST] For instance, investors who bought Cementos Mexicanos SA's 8.875% coupon five-year notes in late September [/INST] have seen the price of their bonds rise four points, or $40 for every bond of $1,000 face value, as the yield dropped to 6.84% from 7.90%. </s> |
245 | <s>[INST] In spite of such bright forecasts, however, a number of [/INST] veteran investors in Latin America -- including G.T. Capital, Pilgrim Group and Alliance -- passed up Argentina's latest offering. </s> |
246 | <s>[INST] That's because other, less-liquid Argentine government bonds are [/INST] better values and have significantly higher yields, according to G.T. Capital's Mr. Pappayliou. </s> |
247 | <s>[INST] Treasury Securities With key inflation data looming, prices [/INST] of U.S. Treasury notes and bonds drifted in narrow ranges to end little changed. </s> |
248 | <s>[INST] The benchmark 30-year Treasury bond [/INST] was unchanged at 101 2/32 to yield 6.16%. </s> |
249 | <s>[INST] The market began the day [/INST] heading slightly lower amid light dealer selling. </s> |
250 | <s>[INST] "We started off testing the low side, but when we couldn't [/INST] go through Tuesday's lows we ended up just bouncing around," said Matthew Alexy, government bond-market strategist at CS First Boston. </s> |
251 | <s>[INST] Prices recovered in the afternoon following release of the [/INST] Federal Reserve's Beige Book report, which provides anecdotal evidence of economic activity around the country. </s> |
252 | <s>[INST] "The Beige Book had kept the [/INST] market a little bit concerned through the morning," Mr. Alexy said. </s> |
253 | <s>[INST] "But it basically said economic activity is [/INST] expanding at a moderate pace and it cited prices as being very stable. </s> |
254 | <s>[INST] That was the kind of [/INST] outlook the market was able to deal with". </s> |
255 | <s>[INST] Keeping activity restrained was a reluctance to [/INST] make big commitments just before new inflation figures are to be released. </s> |
256 | <s>[INST] The Labor Department is slated [/INST] to release the November producer-price index report this morning. </s> |
257 | <s>[INST] Forecasts center on a moderate 0.2% rise for both [/INST] the overall index and the core rate, which is the index excluding food and energy. </s> |
258 | <s>[INST] Forecasts center on an increase in [/INST] the CPI of 0.2% overall and 0.3% excluding food and energy. </s> |
259 | <s>[INST] Municipal Bonds Buyers were out in full force in [/INST] the municipal-bond market again, and they gobbled up new supply that totaled more than $1.2 billion. </s> |
260 | <s>[INST] In the secondary market, there were enough purchases to [/INST] lift prices of actively traded issues 1/8 to 1/2 point-marking the fifth session of gains. </s> |
261 | <s>[INST] The major driving force behind the rise is buying stemming from the belief [/INST] that supply will dry up next month, when there are heavy bond calls and reinvestment-related purchases of whatever securities are available, muni specialists say. </s> |
262 | <s>[INST] The highlight of this session's new-issue activity [/INST] was the pricing of the New York Local Government Assistance Corp. </s> |
263 | <s>[INST] (LGAC) Series 1993D and [/INST] 1993E bonds by a Bear, Stearns group. </s> |
264 | <s>[INST] The bonds initially totaled $600.9 million and [/INST] had yields that ranged from 3.30% in 1995 to 5.50% in 2014. </s> |
265 | <s>[INST] But demand was so hearty that the offering's size was [/INST] raised to $702.5 million at a repricing, and there were across-the-board yield reductions of 3.0 to 10.0 basis points. </s> |
266 | <s>[INST] Following the repricing, the issue includes $337.2 million Series [/INST] 1993D new-money bonds, which are priced to yield from 3.20% in 1995 to 5.47% in 2014. </s> |
267 | <s>[INST] The $365.2 million Series 1993E refunding bonds are [/INST] priced to yield from 4.25% in 1999 to 5.38% in 2016 and 2021. </s> |
268 | <s>[INST] So far this week, more [/INST] than $3 billion of municipal securities has been priced. </s> |
269 | <s>[INST] Mortgage & Asset-Backed Securities Most mortgage securities trawled along [/INST] near flat, and an expected asset-backed offering hadn't come to market as of late yesterday. </s> |
270 | <s>[INST] to price a $1 billion, two-part [/INST] credit-card offering, in the bank's first securitization of its credit-card portfolio. </s> |
271 | <s>[INST] The offering was expected to include 10-year [/INST] securities, only the third credit-card offering with 10-year issues this year. </s> |
272 | <s>[INST] Mortgage dealers and investors, like everyone else in [/INST] the fixed-income universe, are cautiously concerned with inflation data due in the next two sessions. </s> |
273 | <s>[INST] The government will release the November [/INST] reports on producer and consumer prices today and tomorrow, respectively. </s> |
274 | <s>[INST] Among conventional mortgage issues, Ginnie Mae [/INST] 6.5% securities for December delivery were up 2/32 at 99 25/32. </s> |
275 | <s>[INST] Fannie 6.5s were up 1/32 at 99 [/INST] 24/32 and Freddie Mac Gold 6.5s were also up 1/32, at 99 29/32. </s> |
276 | <s>[INST] Those issues had suffered last session and early yesterday on [/INST] news that the Veterans Administration would be encouraging veterans holding mortgages with rates of 8.5% and higher to refinance. </s> |
277 | <s>[INST] ___ Document 160 of 400 The Americas: Argentina privatizes oil and vitalizes [/INST] stock market Author: Mulford, David C Publication info: Wall Street Journal , Eastern edition [New York, N.Y] 12 Nov 1993: PAGE A15. </s> |
278 | <s>[INST] accountid=28034 Abstract: David C. Mulford discusses the [/INST] preparation for and the privatization of YPF SA, the state-owned Argentine oil company. </s> |
279 | <s>[INST] The government cut its interest in the [/INST] $7 billion firm to 20% while maximizing the stake held in Argentinian hands. </s> |
280 | <s>[INST] Mulford says the effort represents a constructive example of [/INST] how to maximize the socioeconomic rewards from privatization for the benefit of society at large. </s> |
281 | <s>[INST] 31, the former state-owned oil company of [/INST] Argentina became the world's 11th largest privately owned integrated oil and gas company. </s> |
282 | <s>[INST] The privatization of YPF S.A. was accomplished in a single two-part operation: the largest-ever initial public offering of [/INST] a single company's shares to have been distributed internationally ($3.04 billion, or 45% of the company), and an exchange offer in Argentina of an additional 13% of YPF's shares for government bonds issued to pensioners. </s> |
283 | <s>[INST] Three years before, the country [/INST] had just passed its peak of 200% monthly hyper-inflation. </s> |
284 | <s>[INST] It had had a fiscal deficit equivalent to 22% of its gross domestic product, no [/INST] growth, no access to international capital markets, could not service its huge burden of external debt, and was at the nadir of a decades' long economic decline. </s> |
285 | <s>[INST] Now, in full public view, Argentina had concluded one of the [/INST] world's largest and most successful international equity offerings, and the largest financial transaction ever to have emerged from Latin America. </s> |
286 | <s>[INST] The ultimate success of privatization depends on [/INST] winning and keeping the confidence of the world's investors with sound government policies. </s> |
287 | <s>[INST] In this regard, Argentina's stabilization and [/INST] structural adjustment program was and continues to be an overwhelming success. </s> |
288 | <s>[INST] Inflation has been cut to single-digit levels; solid [/INST] GDP growth continues; fiscal and monetary discipline have been established; widespread deregulation is under way. </s> |
289 | <s>[INST] In addition, restructuring of the country's [/INST] external debt under the Brady Plan was completed in April. </s> |
290 | <s>[INST] Significant trade liberalization has taken [/INST] place, and stable employment levels have been achieved. </s> |
291 | <s>[INST] This was the foundation on which President [/INST] Carlos Menem and Economy Minister Domingo Cavallo built their privatization strategy. </s> |
292 | <s>[INST] Perhaps the most crucial aspect of YPF's flotation was the prior [/INST] transformation of the company from a politically managed, government-owned monopoly into an internationally competitive integrated oil and gas company. </s> |
293 | <s>[INST] The speed with which CS First Boston and Merrill Lynch, as joint global coordinators, concluded the [/INST] offering -- about three months from their appointment to the closing of the transaction -- masks the lengthier consultation and restructuring that was a necessary precursor to its launch. </s> |
294 | <s>[INST] The preparation of YPF itself was conducted by YPF [/INST] President Jose Estenssoro, an industry veteran hired from the private sector expressly to oversee the process. </s> |
295 | <s>[INST] It entailed a refocusing of YPF, [/INST] like other major international oil companies, on its existing production capacity. </s> |
296 | <s>[INST] Assets and activities considered nonstrategic and [/INST] without significant profit potential were sold or identified for sale. </s> |
297 | <s>[INST] Other assets, deemed nonstrategic but of greater profit [/INST] potential, were committed to joint ventures or other contractual arrangements with third parties. </s> |
298 | <s>[INST] An internal reorganization of YPF into two distinct business units [/INST] led to a slashing of the YPF work force to about 10,000 employees from 57,000 in two years. </s> |
299 | <s>[INST] These units were designed so that management [/INST] could evaluate operations in a manner appropriate to a deregulated environment. </s> |
Subsets and Splits