Chile tapped a new pocket of capital this week with a two-tranche sale totaling 380 million francs, or $458 million. That came after last week's first-ever Swiss-franc issue from Mexico's Fomento Economico Mexicano SA. Latvia joined the club in July with its inaugural franc bonds, and Chile's Banco BICE met investors this week about a potential deal.
Chile's Finance Ministry said demand for the sovereign sale was drawn "almost entirely" from Swiss buyers. The ministry also noted that issuing in francs "establishes five- and 10-year sovereign benchmarks in the currency that could serve as a reference for other Chilean issuers."
According to Bloomberg, emerging-market governments and companies had placed about $3.9 billion of Swiss franc paper so far this year through Monday. Those figures cover deals executed between Jan. 1 and Sept. 28 of each year and span corporate as well as sovereign borrowers.
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Issuance is running at the quickest pace since 2019, and the year-to-date haul is nearly triple the same stretch of 2025. Even then, it is tiny beside the $610 billion emerging borrowers have raised in hard currencies overall.
Serving as Gramercy Funds Management's co-head of sovereign research, Petar Atanasov said, "Creating the pipeline to a non-US dollar market gives sovereigns additional options, which is valuable in the current environment." He added that, given Swiss policy rates are at 0%, local buyers seeking income find high-quality EM sovereign paper attractive. Atanasov also cautioned, "This market is likely to be accessible only for the highest-rated EM credits," pointing to A and BBB names. "It should not be seen as a potential replacement, but as a complement" to other hard-currency markets.
And while the Swiss-franc market works for some, it lacks the depth and liquidity of dollars and euros, which caps its role for many issuers.
Bottom line, the franc window gives top-tier emerging borrowers another place to fund and to set five- and 10-year markers in Swiss currency. But the pool is shallower than dollars or euros, so expect this to stay a niche next to the $610 billion raised in other hard currencies, with access clustered among stronger EM credits.
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