02431cas a2200265 a 4500 AALejournalIMF014952 230101c9999 xx r poo 0 0eng d 5.00 USD 9781498307802 1018-5941 BD-DhAAL BD-DhAAL Rodrigues Bastos, Fabiano. Corporate Financing Trends and Balance Sheet Risks in Latin America / Fabiano Rodrigues Bastos, Herman Kamil, Bennett Sutton. Washington, D.C. : International Monetary Fund, 2015. 1 online resource (31 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Easy global liquidity conditions, stronger risk appetite and a retrenchment in cross-border bank lending led to a surge in emerging market firms' bond issuance in international markets (what we term 'The Bon(d)anza'). Using firm-level data for five large Latin American economies, we provide evidence of a significant change in companies' external funding strategies and liability structures after 2010, as well as in the balance sheet risks that firms face. We find that stepped up bond issuance was mostly aimed at re-financing rather than funding investment projects, as firms extended the average duration of their debt while securing lower fixed-rates, reducing roll-over and interest rate risks. The shift towards safer maturity structures has come at the expense of a leveraging-up in foreign-currency-denominated financial debt in several countries- reversing a de-dollarization trend seen during the last decade. We also provide evidence that a substantial part of these bonds were issued through offshore vehicles, suggesting regulatory and tax arbitrage strategies. For some corporations, rising dollar debt and high leverage will be particularly taxing in an environment of US dollar strengthening, less buoyant commodity prices and slowing domestic activity. Mode of access: Internet Kamil, Herman. Sutton, Bennett. IMF Working Papers; Working Paper ; No. 2015/010 Full text available on IMF http://elibrary.imf.org/view/journals/001/2015/010/001.2015.issue-010-en.xml IMF e-Library