Debt exchange with ANSeS: the UBA warns that the opinion “is not an endorsement” and warns about the risks

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The Faculty of Economic Sciences (UBA) warned this Monday that the opinion on the debt swap with ANSeS “It’s not an endorsement of anything” AND warned about the risks of the operation. In this way, the house of studies he denied that his opinion implied an endorsement of the measure promoted in March by Sergio Massa, who turned to that body to clarify the issues that had arisen in the market and in the opposition, without going through Congress.

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“Given the appearance in various news media indicating that the UBA has “approved” certain clarifications correspond to the securities exchange operation decided by the Ministry of the Economy: the first, fundamental, is that the report does not approve or endorse anything (nor was he asked to do so), but rather answers two specific questions he received from the Minister of Economy,” economist Andrés Lopez explained on Twitter.

López is a professor at the Faculty of Economics and as a member of the board he was the one who proposed the technicians in charge of the opinion, Julián Leone and Daniel Milia, with the consent of the governing body. Leone has a degree in Economics and is a professor of a subject responsible to the Secretary of Commerce, Matías Tombolini, while Milia is a PhD student in Economics and vice president of the Council of Economic Professionals of Caba.

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On March 23, the government ordered ANSeS and a hundred organizations to exchange dollar bonds for a double peso bond (adjusted for inflation and devaluation) until 2036, and the sale of bonds in that currency. But following complaints from the opposition on an alleged attempt to “empty” the ANSeS Sustainability Guarantee Fund (FGS), Massa asked for an opinion from the UBA and the General Audit of the Nation (AGN).

The Faculty of Economics is an institution under the control of the UCR del Capitale, chaired by Emiliano Yacobitti. Massa asked the current vice-rector of the UBA and radical deputy to evaluate the exchange. Yacobitti has an excellent relationship with Massa. He is part of Evolución, the space of Martín Lousteau, and was key for the government to approve the 2023 budget last year. Blocking him was the one who gave the quorum and then voted in favor of the rule.

But following the optimistic reading of the opinion released this Monday by the Ministry of the Economy, López left to take off at UBA. “As underlined by Vice Chancellor Emiliano Yacobitti It is the UBA’s obligation to answer the questions received by social actors, including of course the government. but i cant comment institutionally on economic policy decisions and it doesn’t do it here either,” López said.

He also exposed the file risks of the operation in the event of a scenario other than that envisaged by the government. “The response highlights some potential risks of the proposed transaction and hints at scenarios where the calculation of capital impacts required it might be less favourable compared to those foreseen in the question of the Minister of Economy”, he said.

In his consultation, Massa limited himself to verifying whether the exchange of securities under foreign (global) and national (Bonars) law with the Treasury represents a patrimonial loss for state entities, without taking into account the impact of the subsequent sale of securities by the Treasury. Therefore, the UBA warns him “Should in no way be construed as an economic policy judgment or full impact analysis and the potential of the evaluation itself developed”.

With these caveats, eThe report argues that the swap would have a “neutral effect” for the public sector, including ANS. As regards the Bonares, it can be deduced that for each nominal value of the Dual 2036 Bond delivered to the organizations, they will obtain an appreciation of 45.9%. “The accounting gain reflected in that exercise is verified by virtue of the change in the form of registration of public securities traded,” reads the opinion.

Therefore, he concludes that the transfer of Bonares in exchange for duals “does not imply a loss at the initial moment” in the value of the portfolio of organisms. But warn that “the effect associated with the increase in public debt denominated in foreign currency in the hands of the private sector must be considered, which would derive in the context of the transaction in question from the possible sale of public securities on the market at prices well below the couple”.

and adds it “the counterpart is the validation of high foreign exchange yields”suggesting a higher level of public sector borrowing.



Source: Clarin

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