Angola's Bonds Rally After $1.2B Issuance to Manage Debt

BREAKING NEWSJanuary 5, 2025 at 11:45 PM UTC

TLDR

Angola’s international bonds outperformed emerging-market peers on Friday
That followed a $1.2 billion issuance under its Global Medium Term Note Programme
The deal allows Angola to exchange the bonds for $600 million in financing

Angola’s international bonds outperformed emerging-market peers on Friday following a $1.2 billion issuance under its Global Medium Term Note Programme.

The 2030 Eurobonds, sold on December 27 with a 10.95% coupon, traded above their listing price, while the yield on Angola’s 2049 bonds fell 13 basis points to 11.35%, a two-week low.

The deal, structured as a total-return swap with J.P. Morgan Securities Plc, allows Angola to exchange the bonds for $600 million in financing. This reflects Angola’s complex approach to managing its external debt, which accounts for 70% of GDP.

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Key Takeaways

With $864 million in bonds maturing in November and external debt pressures, Angola is diversifying its borrowing strategies. The country is exploring sovereign debt issuance in the Gulf Cooperation Council region and considering environmental bonds to ease its debt burden. Angola’s successful Eurobond issuance highlights renewed investor confidence as African nations, including Senegal and South Africa, re-enter global markets after a two-year hiatus driven by higher borrowing costs. The transaction’s structure, however, raises questions about the bonds’ liquidity and market activity, signaling a cautious yet creative approach to debt management.

Angola

Economy

Debt Crisis

Eurobond

JP Morgan

Dollar Bonds

Finance