Argentina moves to expand local bond market

Argentina is trying to make it easier for companies to raise sell bonds domestically in an effort to grow the local capital markets and encourage more people to invest in debt securities.

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The country’s securities regulator issued a resolution Thursday that removes a requirement for issuers to first seek its blessing for bond sales. The exemption is for companies looking to raise smaller amounts with shorter-dated bonds that are not convertible into shares, according to the resolution.

The goal of the regulatory change is to encourage more companies, including first-time issuers, to turn to the local capital markets for financing, Roberto Silva, president of the National Securities Commission, said in a press release.

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The changes “open new opportunities for companies taking their first steps in the capital market, facilitating issuance when it comes to moderate amounts,” he said.


The red tape involved in issuing bonds has kept many smaller companies from tapping the market, leaving them reliant on cash flow and bank loans instead.

Federico Sturzenegger, Argentina’s minister of state deregulation and transformation, praised the measure, saying that it will open up new opportunities as well for retail savers to invest in the bond market.

“The basis of capitalism is the connection between businessmen and entrepreneurs with risky projects and savers who are willing to finance them,” he said on social media platform X.

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DEEPER MARKETS

In Argentina, excessive bureaucracy has long made it “unthinkable” for a smaller companies to sell bonds, let alone shares, Sturzenegger added.

With the changes, investors will now be able to put their money into companies that will invest in “good projects” instead of leaving it in the banks or foreign currencies.

While so far the amounts for simplified issuance are at around $1 million or less, Sturzenegger said this is the first step to open up the capital markets to more issuers.

“We are beginning to go down the path toward becoming a country where people can freely issue and invest in bonds or stocks,” he added.