Mongolia’s Dollar Bonds Jump After IMF Loan

The sovereign’s $1b 5.125% 2022 notes jumped 4 cents on the dollar to 92.4 cents as of 11:42 am in Hong Kong, according to Bloomberg prices. The rise was biggest since August 16.

Mongolia reached an initial agreement with the IMF for a 3-year program that includes a $440m loan package as part of a $5.5 billion bailout to help the north Asian country with looming debt repayments.

  • The nation will kick off investor meetings for USD bonds from Feb. 22.
  • Development Bank of Mongolia plans to exchange $580mm 5.75% 2017 bonds with new notes from the sovereign that are expected to price on March 2, ahead of DBM’s March 21 maturity.
  • DBM’s 2017 bonds climbed 1.85 cents to 99.4 cents. The jump was biggest since March 4.

“It seems like all stars are finally aligned, the new government is very investor friendly,” says Leo Hu, an emerging-market debt portfolio manager at NN Investment Partners in Singapore; “Oyu Tolgoi mine phase II is on the way, the IMF program has great focus on much-needed fiscal reforms”.

Source: Bloomberg