Swap Conversion Operation

May 18th, 2016. The Ministry of Economy and Finance, through its Debt Management Office, conducted a swap transaction to exchange two dollar-denominated loans with the World Bank, to Japanese Yens. The transaction was for the equivalent of USD 500 million and a tenor of 15 years (same amount and maturity of the loans).

After this operation, the interest on these loans changed from Libor-linked floating rate (currently 0.90% annually), to a fixed annual rate in JPY of -0.40% (negative 40 basis points). The operation has three main objectives. First, achieve greater diversification in the foreign-currency basket of the Central Government`s debt portfolio, improving the risk profile. Second, continue to increase the share fixed-interest rates, muting the impact of an eventual rise in interest rates in the United States. Finally, reduce expected debt-servicing costs, by taking advantage of the divergence in monetary policies between the US and Japan.

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Sovereign Debt Management Unit

MMinistry of Economy and Finance of Uruguay
Colonia 1089 Tercer Piso CP 11100 Montevideo - debtinfo@mef.gub.uy

Última Actualización: 13/08/2020