- Does the UBA approve the debt swap with ANSeS?
- The UBA was not asked for a comprehensive approval, it did not give a favorable opinion.
The UBA is entrusted with an exercise on the exchange between the Treasury and public organizations, within which the FGS (Sustainability Guarantee Fund) of ANSES has a leading role.
From the questions of the Ministry of Economy, assumptions and ways of accounting for the valuation of the bond arise, which is given to you and generates an exclusively accounting profit.
- Does it have an impact on retirements?
- This exercise has nothing to do with pension assets, in no way should it be interpreted as a gain for retirees.
The FGS, after more than 15 years, was never used to solve insufficiencies in the financing of retirements.
So, the exchange operation between the Treasury and ANSES has no direct impact on assets.
The FGS does not pay pensions.
They are paid with contributions, contributions and taxes.
- What are the risks of the measure?
- What is less talked about is a second operation, which is the sale of Bonares, public securities under national law that have to be sold to the market and with what you collect you can subscribe dual Treasury bonds.
When the FGS sells public securities in the market, it is acting as a public debt issue in dollars.
- And what implications does that decision have?
- Not only are you generating an increase in public debt in dollars, the striking thing is that you sell bonds to the private sector at very low prices and whose counterpart is to validate strikingly high returns in foreign currency.
You are getting into debt at a really high rate, which depends on the bond you are depending on between a 25% and 45% rate in dollars, it is historically very high.
- Is that a risk?
- The FGS removes a title at market value with very low parities and, on the other hand, records it at technical value, which is why you inflate the accounting profit.
A comprehensive analysis must have a prospective sustainability scheme, a point that was not requested by the Ministry of Economy.
The point is not in the exchange, but in the exit of debt from the FGS to the market.
It is made of State bonds, which, after all, is the guarantor of retirement payments, so the operation has a neutral effect.
The FGS never had the anticyclical role that was set in the DNU of its creation.
- Is it a problem that the ANSeS fills up with bonds in Treasury pesos?
- It would be necessary to discuss whether these funds should not contain public assets because it is a State body with debt papers against itself, and it is necessary to see if the Treasury securities would have the capacity to counteract fluctuations or mediate before the negative evolution of variables economic and social.
- What would happen if interest rates rise?
- As the interest rate is higher, you discount future flows more strongly and the accounting profit is reduced.
By changing the way of recording the value of the bonds, you inflate the book profit.
In this case, the FGS wins at the expense of the State itself.
Now, the favorable valuation is achieved at the cost of extending the average life of the agency's assets (by receiving bonds in pesos by 2036), with which the rise in rates at the international level can negatively affect the yield of the bonds.
- In conclusion, what should be taken into account in the future?
- Highlight the effect of an increase in debt that will end up in private hands from the FGS.
An increase in the public debt in foreign currency of the public sector is being validated at prices well below parity and, therefore, the State is borrowing at very high rates.
