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Bond buybacks: heavy losses for the Treasury and an investigation with few findings


Two months ago an operation was launched to repurchase US$1 billion Treasury bonds. Bonds plummeted. The CNV opened a file.

Exactly two months ago, on

January 18,

Economy Minister Sergio Massa brought out what was then known as

"another rabbit"

out of the hat: the

repurchase of debt bonds.

It was said that this move would lead to an improvement in country risk and consequently a way of bringing Argentine companies closer to the global credit market.

Today it can already be stated that the operation was a

complete failure


The bonds are worth between 15 and 20% less than the price paid by Economy today.

And the country risk, which was at 1,881 points, closed on Friday at 2,383 points.

Since it is not clear how much of the $1 billion allocated to the operation was actually used, it is difficult to calculate how much this martingale cost.

The move was so negative that

even the IMF demanded that it not be insisted on


An elegant way of saying that the few dollars that the Government has today will not be wasted.

The bankruptcy in the operation is already clear.

What is still not reliably known is whether, in addition,

someone had privileged information to take advantage of the turmoil of those days

and translated it into earning extra money.

It is known that Massa ordered the National Securities Commission to open a file to investigate

fraudulent maneuvers


Until this Friday, according to what


was told by sources who closely follow the case, the investigation -which is secret- made progress in taking statements from the main ALYCs (Stock Market Operators) so that they can show them the movements of their 100 most active

accounts and bulky


The first conclusion is that the ALYCs operated bonds those days with their

own accounts and funds.

Regarding the considerable increase in volume, the declarants indicated that it is explained because the possibility of

arbitrating between two prices of the same product

(the GD35 bond) that had distanced themselves, according to local and foreign prices and according to the settlement term -immediate or 48 hours-.

This resulted in making

quick profits


Which justified, in the eyes of market experts, that many people borrowed money -


- to leverage operations and consequently multiply profits.

The sureties were in pesos and dollars, but at very high rates compared to previous days.

But since debt was taken on a single day, the cost paid for said debt was secondary, since the possible profit justified it.

In the next few days, the CNV will summon account holders who were

inactive in the 90 days prior

to the events investigated, and who remained quiet afterwards.

Maybe some valuable information will be taken from there.

The movements of accounts that have had an unusual volume of operations on those days will also be investigated.

Once the investigation stage is over, the CNV must draw its conclusions and submit the file to criminal justice.

The forecasts allow us to assume that no irregularities will be found.

Source: clarin

All business articles on 2023-03-18

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