By Daniel Huang
Ecuador is selling $2 billion of bonds on Tuesday, the South
American country's first international debt deal since a 2008
default.
The 10-year bonds are being offered with interest rates of
7.95%, according to a banker familiar with the deal.
Ecuador's return to global capital markets underscores some
investors' increasing willingness to tackle risky wagers as they
seek to bolster returns in an environment of record-low interest
rates.
Proceeds from the deal will be used to fund budgetary items and
to strengthen the country's infrastructure and transportation
system, the government said. Credit Suisse Group AG and Citigroup
Inc. are the banks on the bond offering.
In 2008, Ecuador defaulted on $3.2 billion in global bonds, a
debt burden that President Rafael Correa at the time called illegal
and illegitimate. A year later, Ecuador bought back 93% of the
defaulted debt at 35 cents on the dollar.
The country has $650 million of bonds due in 2015, which the
government continues to service. Standard & Poor's and Fitch
Ratings have given this debt a B rating, which is in "junk"
territory.
Some of the proceeds from Tuesday's sale will likely go toward
refinancing this debt, according to people involved with the
deal.
Write to Daniel Huang at Daniel.Huang@wsj.com
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