Magazine article American Banker

Failed Coup Unsettles Venezuela Debt Prices

Magazine article American Banker

Failed Coup Unsettles Venezuela Debt Prices

Article excerpt

Failed Coup Unsettles Venezuela Debt Prices

LONDON -- The attempted coup in Venezuela sent the price of the country's debt reeling on the secondary market, but traders said little actual business was being done as most dealers refused to quote firm prices.

Venezuela also decreed a two-day halt in foreign currency transactions to avert panic in the money market, Labor Minister Ruben Rodriguez said.

Brokers of sovereign debt quoted Venezuelan par bonds at 62 1/4% of face value -- 4 1/4 percentage points lower than Monday's closing level in London.

Pricing in Limbo

"I've phoned nearly everyone in the market this morning and I can't get a decent price," said one trader. "The market is very nervous about what might happen when New York opens."

Venezuelan President Carlos Andres Perez said earlier, in a television address, that loyal troops had put down the coup attempt by rebel soldiers who planned to assassinate him. There were no details of casualties.

Scattered skirmishes were reported continuing in the capital and elsewhere in the country Tuesday as the captured rebel leader, identified as Commandante Hugo Chavez, appeared on local television to urge insurgents to lay down their arms.

Debt Conversion Bonds Down

According to Venezualan radio reports, the coup attempt was headed by military officers of middle and low rank. Senior military officials quickly expressed their support of the Perez government.

The country's debt conversion bonds were quoted bid at 67 1/4% of face value -- down nearly four percentage points from Monday's close. …

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