Banco Santander Argentina will launch today a line of new loans for SMEs at an annual rate of 20% for a total amount of one billion pesos ($15.9 mn) and a term of up to 24 months. The maximum amount per customer is 3 million pesos ($47,672). The bank will help to mitigate the impact of containment measures to protect the population from the spread of coronavirus may have on the economy and the normal functioning of the business. Also, affected companies will have more flexibility in managing their cash flow.
Following the Government’s move to suspend international passenger flights from “coronavirus affected areas” for a period of 30 days, some 154 weekly flights would be affected. The estimate consists of 84 weekly flights from the United States and 70 from Europe. Source: Clarín
The country risk, which measures the debt relief surcharge that the country must face, exceeded 3,000 points for the first time since 2005. Although the market attributes it to the coronavirus pandemic, this indicator is advancing more in Argentina than in other territories. In one month it has already risen 60%, closed at 3,225 points and during the day had bordered on 3,300. The Merval dropped 9.76%. In addition to the adverse international environment, there is also uncertainty about the local trade-off offer.
In another day of maximum tension in the markets due to the effects of the coronavirus, the dollar rose sharply in Argentina in all its versions: The tourist dollar, which bears the 30% surcharge for the COUNTRY tax, rose 37 cents to $84.53. In the informal market, the parallel jumped to $82.25. In the stock market, the “Liquid Cash” dollar (CCL) obtained from the purchase and sale of shares or bonds in the stock market reached $90.11 during the round.
According to a study by the Argentine Association of Private Capital, Entrepreneurs and Seeds (ARCAP), investments in the sector exceeded $400 million in 2019, with Fintech and Biotechnology being the areas with the most significant growth. The ventures that received financing are in the city and province of Buenos Aires, with a strong predominance of men.
This Thursday, the INDEC released the Consumer Price Index (CPI) for February, which recorded monthly inflation of 2%. The most significant increase in February was in the Restaurants and Hotels category, influenced by the high season and the end of the holidays, with a variation of 3.1%. In second place was Food and Beverages, the item with the most significant impact on the general level, which recorded a rise of 2.7%.
The price of soybeans fell Thursday to $314.17 per ton (-1.5%), in the reference market of Chicago. Wheat fell to $186.75 per ton (-1.8%), and corn fell to u$s145.57 per ton (-2.6%). For Argentina the impact is important because China is the largest importer of agricultural products in the country; it is the recipient of 90% of soybean exports, 70% of beef (over $2 billion) and 22% of pork ($3.5 million in 2019).
The Government is today placing new debt to meet maturities of more than 130 billion pesos ($ 2.1 bn) that operate between late March and early April. It offers a 90-day discount letter with a yield of approximately 39.5% and another note adjustable by the Reference Stabilization Coefficient (RSC) with an additional return of 2% at an eight-month term. The Government offers holders of the Dual Bond a redemption combo whereby they can make 75% with the CER and 25% with the discount letter.
Argentina needs substantial relief in the restructuring of nearly $70 billion in public bonds. The global outbreak of the coronavirus could change the March 31 deadline for reaching an agreement with bondholders. The Argentinian Government reported that it cannot pay interest over the next few years and that the country could reach fiscal equilibrium between 2022 and 2023.
Shares of Argentine companies listed in New York collapsed again yesterday. YPF had an 11% loss and closed at $5.41. The Techint Group´s Tenaris, which manufactures steel pipes for the oil industry, fell 8% to $12.19, while Ternium, contracted 9.2% to $12.78 per share. Banco Supervielle fell 15% to $1.97; Banco Francés fell 14.4% to $3.8; Grupo Financiero Galicia fell 8.1% to $10.16, and Banco Macro fell 7.8% to $23.7. Mercado Libre fell 8.1% to $550.72 and Despegar, a virtual travel agency, fell 9.5% to $9.06.