Companies anticipate funding to shield themselves from political tension and high interest rates – Economy

Given the anticipation of political-electoral tensions and the prospect of inflation and interest rates reach higher levels next year, several companies are raising billions in funds in the market to strengthen their cash registers and roll over or lengthen debts taken before and during the pandemic.

The bond market has seen a boom in issuance announcements by giants such as With gas, 3R Petroleum, vibrate and Hypera, with operations of around R$ 1 billion. Although the fee Selic having gone from 2% in March to 5.25% in August, with expectations that it will reach 8% by the end of the year, the cost of funding for companies is still favorable.

Some companies have also started to access the foreign market in search of resources. September is traditionally the second best window of the year for funding abroad, with investors returning from the holiday period. moved and Suzano yesterday raised US$ 300 million and US$ 500 million, respectively.

With the prospects of a change in the trend of local and foreign interest rates, and political uncertainty threatening the fiscal and macro scenario, companies are seeking to anticipate operations that they would eventually do later. Experts believe that several other companies should access the foreign debt market by the end of the year, for an amount that could exceed $3 billion this month alone.

According to the director of fixed income and structured products at Itaú BBA, Felipe Wilberg, at current cost levels, companies look at their liabilities and begin to anticipate debt renegotiations and lengthen terms, considering the prospect of rates rising a little more. According to him, companies are returning to lengthening the average term of their debts.

The trend towards a sharper rise in interest rates was reinforced with the release of yesterday’s official inflation index (IPCA) for August. The data was above market expectations, at the highest level in 21 years, and led analysts to revise the Selic forecast upwards.

“In 2019, there was a huge volume of offers, and AAA (first-tier) companies raised the CDI plus 1% or 0.80%, over a period of five years. In 2020, this cost went to 3%, now we are talking about 1.40%”, said Wilberg.

O Director of Capital Markets and Infrastructure at Santander Brasil, Sandro Marcondes, states that some companies are also motivated by the resumption, since immunization causes greater economic activity. “In the third quarter there was no expansion of the GDP, but there is a resumption in progress and with the immunization, the expectation is that the uptakes will increase.”

Marcondes notes that in fact companies anticipate funding that they could make next year, given the prospect of greater volatility with the elections. One of the factors driving the volume of operations, according to Wilberg, is the impact of inflation on costs. With greater operating expenses, companies are forced to raise more resources than they would have sought a few months ago.

Support

Wilberg also mentions that banks continue to act to support the issuance of debentures, but not with the same tone as last year, when companies literally depended on institutions to issue these bonds.

In the specific case of Itaú BBA, Wilberg says that the bank has positioned itself to offer maturity options to issuing companies and investors. On the one hand, investment funds seek more returns and, on the other, companies also prefer to extend their debts.

According to him, the bank has been working with debt issues in series – with different maturities – and ends up with bonds that have low market demand. “It’s a good, fungible way to access more pockets,” says Wilberg.