2015 All-Latin America Research Team: Corporate Debt, No. 2: Ciro Matuo & team
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2015 All-Latin America Research Team: Corporate Debt, No. 2: Ciro Matuo & team


< The 2015 Latin America Research Team

Ciro Matuo & teamItaú BBAFirst-Place Appearances: 5

Total Appearances: 7

Team Debut: 2009“I appreciate the strong relationship that they have with the companies under coverage and the local market color they provide,” one fund manager says of Ciro Matuo and his four-strong Itaú BBA crew in Santiago and São Paulo, which slips to second place after four years at No. 1. Major factors affecting Latin America’s credits include a deteriorating macroeconomic growth outlook and softer demand for commodities, says Matuo, who also co-directs, with Ilan Goldfajn, a group that earns its third straight first-place finish on the Local-Markets Strategy roster. “Companies in the region have been trying to deal with the weaker-commodities-price environment with [capital expenditures] and dividend reductions, and by streamlining cost structures and selling noncore assets,” the 42-year-old team leader explains. “However, in some cases, a consistent improvement in credit ratios seems contingent on a sustained recovery in overall commodities prices.” Regarding Brazil, in particular, the researchers are monitoring developments in likely reviews of the country’s sovereign ratings and the ongoing investigations into alleged corruption at state-run Petróleo Brasileiro, or Petrobras, the nation’s largest integrated energy company. They are touting several names in the Brazilian high-yield space, such as Marfrig Global Foods, which earns the analysts’ favor thanks to the opening of new export markets that should boost opportunities for its beef business, as well as management’s earlier-than-expected sale of a European subsidiary that will cut net leverage. Additional examples include Cia. Siderúrgica Nacional — a steel maker trading at single-B levels that has “limited downside,” Matuo says, “as we see the company as a double-B name from a fundamental standpoint” — and Banco do Estado do Rio Grande do Sul. This regional operator, widely known as Banrisul, “benefits from a diversified revenue mix and a granular funding base, which together mitigate the concentration and liquidity risks commonly associated with midsize banks,” he explains.

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