Guatemala begins to enter a maturation phase to boost the capital market as an option for companies to evaluate this route to obtain liquidity. Ana de Jesús Ulloa Rosenberg, director of the firm Zima Investments, explained the conditions that exist in Guatemala to opt for liquidity in companiesduring the Second Capital Market Convention.
The executive announced that there is an incentive to generate new issuing in Guatemala and in the Central American region in the capital market, given the current circumstances and the global economy.
On the other hand, there is a growth in the interest of issuers and investors to carry out this type of operations, which predicts a future consolidation. In various sectors, a new regulation regarding the Securities market law, which could be presented to the Congress of the Republic during the second half of the year by the Executive.
In Guatemala, Debt issuance and their negotiation in the financial market constitutes an option for companies that need resources, which is attractive for both local and regional investors.
Zima Investments carried out the second edition of the Capital Market Convention on May 22, already continues part of the conversation with Ulloa Rosenberg:
What are the financing opportunities in Guatemala and Central America to obtain liquidity?
There are several. From the point of view of the capital market, you have a huge opportunity. Guatemala is an industrialized country that represents for international capitals an important diversification for its portfolios. In addition, it has a stable macroeconomic history and a rating that has been improving gradually. This makes many international eyes put in Guatemala in the face of the opportunities that may arise.
There is also a local opportunity, since individual investors are realizing that they need more than savings, in terms of investment and creation of equity. Nowadays, The individual investor market is ready to place their capital in instruments that generate profitability or assets, and not keep it idle.
In addition, the possibility of energizing that capital through a new law or with more financial education represents a great opportunity called financial innovation. This allows investment, creation of assets and even employment generation. If a company grows, it provides conditions to create more work sources and attract capitals that generate development. I consider that we are at a very important moment.
Why do you advise to think of other ways to achieve financing, what is known as diversification?
The diversification of financing sources for a company represents competitiveness. The more diversified a company is in terms of its sources of financing, the more flexibility it will have in its programs and plans in the short, medium and long term.
For example, accessing liquidity through an issue in the capital market allows capital to be amortized at the expiration of the quota. What does this mean? That instead of paying monthly capital or annually, that payment is transferred to the end of the term, which can be three or five years. This release of the flow represents capital available for investments, so it is important to incorporate financing sources other than traditional ones, such as banking.
It is essential to recognize that banking will always be a strategic ally for the growth of a company, especially in the short and medium term. However, If a company is expanding, you need sources of financing that are heel with your plans.
What would be your main recommendation?
It depends on each company, but it is important that, to opt for this type of financing, it has financial solidity, which implies having a robust capital that allows you to finance.
In the midst of global uncertainty in the economy, why should this alternative be considered for liquidity?
Because it represents diversification. Again, for the investor, depending on a single country with instability or policies that generate nervousness in the markets implies risk. The new opportunities in the region offer geographical and industrial diversification.
For the emitters, it is also important not to “have all the eggs in the same basket”, that is, not to concentrate all their financing in a single country. Having different sources is a toolbox that expands action options.
“The release of the flow that allows it, that is capital to capex or other investments among others, so it is important to incorporate new sources of financing, in addition to traditional ones such as banking “
Ana de Jesús Ulloa Rosenberg, director Zima Investments,
By participating in the capital market, what are the advantages and disadvantages, in your opinion?
Financial advantages include the release of liquidity, the management of financial risk associated with the interest rate and the diversification of sources, which represents a strategic lever as a issuer. It is important to recognize that banking is always a strategic ally during the entire growth of a company, because it specifically attends the short and medium term, but if it is needed more than everything for a company or company that is growing, that may also have sources of financing that calculate their growth plans to the type of source they choose.
What tendency observes in the local market in terms of the capital market and the draft law that is in process?
There are advances and that there is each time collaboration of different sectors that are contributing to be an initiative of the most competitive as possible and that the final project is competitive, with international standards and that this year can occur.
I consider that something good will soon change for the development of the country.
What preliminary results were generated during the Zima Investments convention?
A series of innovative content and ideas were heard with success cases that will be their growth programs to be financed through this mechanism, so We hope to observe soon a greater number of issues or at least more companies or companies start preparing with that financial maturity, Because in the end everything brings development.
Each thing that performs the productive sector to mature, achieve greater strength represents development, so the convention results in a development in the generation of new emitters and A synergy connection point between different actors that are best practices that mean economic development in this area.
It was known that new emissions come that are authorized by the National Stock Exchange (BVN) by the banks and that is a great message.