Treasury Bonds in Guatemala now within reach of small investors
Until not long ago, the acquisition of public debts through the tender of bonds issued by the Ministry of Finance and approved by the Congress of the Republic of Guatemala, was limited to major investors and by sums of high amounts. Since November 14th of this year, individual persons have the option of investing in the stock market.
Inside the market of financial disintermediation in the financial system, the so-called “small” investors will be able to acquire treasury bonds issued by the State of Guatemala, through a brokerage house, subject to the regulation of the Stock and Merchandise Market and its respective law. The investments may participate from a minimum of twenty five thousand quetzals to five thousand quetzals in all the fiscal year.
Regarding the National Stock Exchange (BVNSA, by its acronyms in Spanish), it has argued that the process is known as “democratization” of the public debt, which will allow the modernization of the stock market and the extension of the investors’ base. Previously, the efforts were intended to the standardization and dematerialization of the titles, and now it will seek the access to a bigger market. In accordance with the reports issued by the Superintendence of Banks, until September of the present year the deposit accounts in amounts of 25,000 to 500,000 quetzals are near the 86,000, and the investment amounts exceeded the 13.3 milliard.
The Government of Guatemala stated within the budget approved that it can be awarded up to one hundred million quetzals in the described mechanism. This presupposes a challenge because the individual persons that make an investment will only need their identification document to participate in the award. The availability of the terms is limited to one year and the coupon rate will be fixed to 6.25%.
As it has already been informed by many of the officials of the Ministry of Public Finance, as well as the National Stock Exchange, these projects are seeking to promote the investment culture and the opening of the stock market, including the negotiation of the public values. It is still pending to verify the performance in the offer of the bonds particularly in this modality, but it certainly represents since now an opportunity that could be attractive for many.
Ma. Mercedes Castro
Associate
García & Bodán
Guatemala