The Central Bank will begin this week a last attempt to complete the issuance of the Bopreal, the dollar bond issued by the monetary authority to cancel part of the debt for imports. Some USD 1.8 billion that remain to be awarded to reach the authorized limit for the placement of the last series, 3, which had less appeal for importers.
That window of USD 1.8 billion will be used by the entity he presides Santiago Bausili to “distribute” a part of the dividends of companies based abroad that They were “trapped” when the exchange controls came back into force during the last months of the Cambiemos government. According to private estimates, which the economic team’s offices validate even though there is no consolidated official data, there are some pending payments USD 6 billion for these two concepts.
An estimate made by the International Monetary Fund gives a similar number, recalled an official source. “It must be the best attempt available to calculate it,” she said. In this way, if the BCRA could award the remainder of series 3, which it did not obtain with all the tenders to importers during April, it would reach pay off about a third of those pending payments. That would also be the sum of pesos that it could absorb from the market. Pesos that, given a scenario that is currently uncertain of exit from the stocks, could put pressure on the exchange rate.
The Economist Amilcar Collantewith its own calculation based on BCRA data, estimated a greater number of USD 7 billion. In 2016, according to their estimates, there was a very marked growth in dividends after the exit of the stocks at the beginning of Cambiemos’ mandate, with a monthly average of USD 260 million. Since the reinstatement of controls in the exchange market, that average fell every year and in 2023 it ended at USD 25 million per month. In short, with stocks the monthly average from 2003 until now was USD 38 millionwhile without stocks, it was USD 165 millionCollante calculated.
If the BCRA could award the remainder of series 3, which it did not achieve with all the tenders to importers during April, it would be able to settle about a third of those pending payments.
A report from 1816 reported that “there is a remainder of USD 1,804 million of nominal value of Bopreal Series 3 to be placed and as of this week, companies with dividends withheld in recent years can also participate in the auction,” they explained in a note to your clients.
“Up to this point, Bopreal 3 has had limited demand, given that the implicit exchange rate for purchasing it is much higher than the market CCL. We will see if with the new plaintiffs greater interest appears. It will be another interesting sample of how desperate are they the stocks of pesos to be dollarized,” they stated from that consulting firm.
The latest news regarding the opening of the Bopreal to dividends and profits was that its placement will pay, as it was in the case of the import debt, the 17.5% PAIS tax rate. This will imply a reinforcement of tax collection, within the framework of revenues to the treasury that have accumulated three months of consecutive decline against inflation. The PAIS tax grew 212% in April in year-on-year terms.
The importers who subscribed to Bopreal had, first, to register in a debt registry maintained by the Ministry of Commerce. In the case of profits and dividends pending payment to non-resident shareholders, a series of requirements will have to be met. For now, they will only be able to enter the bidding for “the equivalent of the amount in local currency of the profits and dividends pending payment to non-resident shareholders according to the distribution determined by the shareholders’ meeting.”
The BCRA will have to verify that the Bopreal plaintiff “has the documentation that allows him to guarantee that the outstanding debt corresponds to profits and dividends from closed and audited balance sheets” and that “the operation is declared, if applicable, in the last due presentation of the ‘Survey of external assets and liabilities’”.
“We will see if there is greater interest with the new applicants. It will be another interesting example of how desperate the peso stocks are to be dollarized,” said the consulting firm 1816.
They will also have to submit a sworn declaration that says that profits and dividends are pending payment and that will not be able to enter the single market of exchanges to pay that equivalent debt for which the Bopreal was subscribed “except that the payment is made through an exchange and arbitration with the funds deposited in a local account and originated from capital and interest collections in foreign currency of the bonds “Bopreal.”
Javier Casabal (Fixed Income Strategist at Adcap Grupo Financiero) anticipated that “several banks expressed their intention to pay dividends in this way and they already exceed the USD 1 billion“, according to communications from the entities to investors through the CNV. There would be four banks: BBVA, Santander, Galicia Financial Group and Macrohe indicated.
“Before the stocks, between 2016 and 2019, around USD 2,000 million were normally transferred per year. Since the stocks came into effect, only less than 10% of that has been turned. Yes ok it was not prohibitedpaying dividends through the CCL meant losing access to the MLC and also significantly reduce the value of them, which for many companies is directly unthinkable,” Casabal said.
Although the Bopreal were used to cancel part of the import debt accumulated at the time of the change of government, the staggered import payment scheme itself generated new liabilities for the same concept. A PxQ report put it in numbers.
“Despite the different instruments awarded (Bopreal tenders + access to the MULC for MSMEs), commercial debt would have continued to increase in March. When comparing the commercial debt between December and March with the accumulation of foreign currency by the BCRA, the former was 5% higher than the latter,” they noted. The new accumulated debt, they estimated, is USD 11,103 million. In the same period, the Bopreales delivered for import debt plus the MULC dollars to SMEs rounded USD 9,181 million.
Meanwhile, 1816 also measured that the purchase of Central dollars in these months has a similar amount to the new import debt generated, but that in recent weeks the data shows that “there is something else”. “In the first 4 months of Milei, BCRA purchases were explained by importers’ debt. In March in particular, however, Central purchases already exceeded the increase in commercial debt (USD 2.9 billion vs. USD 1.7 billion),” they indicated.
“There is no complete data for April, but as of the second fortnight, those who imported at the end of December could access the MULC for the last 25% quota, which suggests that the commercial debt must not have grown so much in the month. ”. “If it is not just because of agriculture and the debt of importers, why does the Central continue to buy so many dollars? Our hypothesis is that it is due in part to the financing in dollars that the banks are giving to local companies, which settle those dollars in the MULC. Only between March and April did the local stock of dollar loans increase USD 2 billion (+55%)“, they explained from that consultancy.
“It’s a virtuous circle“Deposits in dollars increase, banks no longer fear a run as much (so they no longer have cash in dollars for 100% of deposits), export companies take advantage of the opportunity to finance themselves in dollars and the BCRA buys foreign currency,” they concluded.
