| CARACAS, April 3
CARACAS, April 3 Venezuela's central bank is
negotiating about $500 million in financing with a New
York-based investment fund by using PDVSA bonds as collateral to
help meet almost $3 billion in debt payments coming due in
April, a lawmaker said on Monday.
The bank began talks with U.S. investment fund Fintech
Advisory Inc three weeks ago to obtain some of the cash needed
to pay external debt this month, opposition lawmaker Rafael
Guzman, who sits on the congressional finance commission, told
"These are desperate measures because (Venezuela) in April
has to fulfill its obligations and apparently does not have the
resources," said Guzman.
"They intend to do an operation; we do not know if it is via
repo or a direct leverage with PDVSA bonds.," said Guzman.
Neither the central bank or Fintech Advisory responded to a
request for comment.
Separately, Venezuela is negotiating to receive financial
support from Russian state oil company Rosneft to comply with
the heavy commitments of cash-strapped state oil company PDVSA
in April, traders and a government source told Reuters last
Venezuela's oil-dependent economy is suffering a brutal
economic recession that has millions of people skipping meals
amid steep inflation and low salaries.
President Nicolas Maduro and government officials have
reiterated in recent weeks that they will continue to comply
with debt payments.
"The government has always done everything possible to pay
its debt, and I still see the president's political will to
pay," a source close to the government said on Monday.
Lawmaker Guzman said that the central bank will negotiate to
use about $1.5 billion in PDVSA bonds as collateral, which it
has in its portfolio, to get the cash.
Another option that Guzman said the government is evaluating
is to offer dollar-denominated bonds to local banks in exchange
for their foreign currency positions
In early 2017, Venezuela was evaluating a repurchase
agreement with investment bank Nomura, which also
would have entailed offering PDVSA bonds as collateral in order
to obtain liquidity, Reuters reported.
Guzman said the operation with Nomura was suspended a few
days ago, amid last week's scandal in which the Supreme Court
assumed the powers of the Congress, a decision later reversed.
"Nomura understood and preferred not to get involved,"
Opposition lawmakers said the central bank cannot carry out
that type of debt operation and the Ministry of Finance cannot
carry out any issuance or loan without Congress' authorization,
a stance the government rejects.
"Any central bank can do repo operations, debt operations,
without requiring authorization from anyone, because it manages
its investment portfolio as per the expectations of the market,"
said a source close to government.
(Writing by Girish Gupta; editing by Diane Craft)