Summary: COLTES buyers in March were concentrated in local holders with offshores largely flat for the month in terms of allocation changes. Purchases were spread between commercial banks, public entities and trusts, insurance companies and pension funds, which added COP10.7trn in total. Meanwhile, public financial institutions and mutual funds were the main sellers of COLTES, reducing their allocation by c.COP1.0trn during the month. The government carried out debt swap operations in March, buying the short end of Nominals (2025: COP0.7tn, 2026: COP0.4tn) as well as linkers (2025: COP0.3tn) for a total of COP 1.3trn. The government sold COLTES 2046 (COP1trn) and UVR 2055 (COP0.3trn).
-
Market view: the COLTES market saw a notable 2s10s bear-steepening in March after the resignation of Colombia’s Finance Minister, Diego Guevara, during the month, who was then replaced by the new Finance Minister, German Avila, who started by reorienting the fiscal focus more towards improving revenue generation and collection and somewhat less toward expenditure cuts as Guevara had emphasised together with the C.A.R.F (the countries fiscal watchdog). The very long-end faired better than the 5Y through to the 10Y segments of the curve. The yield curve has continued to steepen in the first half of April, albeit in a twist fashion rather than outright bearish. Tenors of 5Y in maturity or less have seen yields fall while the 7Y and beyond rose moderately compared to March amid increased global market/trade uncertainty and a back-up in long-end US yields. We still see value in COLTES 2028s and 2031s as a play for high carry and rolldown and would recommend being long COLTES 2031s from 11.63%, with a target of 11.25% with a stop-loss of 11.82%. Progress and more clarity on fiscal consolidation will be needed from the Hacienda to support the performance of long-end duration.
-
Public entities were the second-largest buyers of COLTES in March, adding a sizeable COP2.3trn. This comes after selling the same amount in February. The selling was all concentrated in the Nominal TES market in a shift that drove holdings up to COP4.4trn (+108.6% MoM) or up from 0.3% to 0.7% of the COLTES market.
-
International investors COLTES allocation remain fairly steady only increasing by c.COP0.1trn in March 2025, a 0.1% MoM increase. The supply growth of COLTES of 1.8% MoM meant holdings fell from 17.6% in February to 17.3%, remaining close to their lowest level since March 2016. Interesting UVR linkers accounted for most of the net monthly purchases (+COP 94bn of +COP102bn).
-
Commercial Banks were the largest buyers of COLTES in the month of March with net purchases totaling just over COP3.5trn increasing their holdings to c.COP95.0trn (+3.8% MoM). The fast rise in holdings pushed ownership up by 0.3pp to 15.3%. As a result of this monthly increase, Nominal COLTES accounted for 95.5% with the remainder going to UVR linkers.
-
Pension funds were net buyers of COLTES in March, albeit at a much slower pace than in February with inflows of just c.COP1.5trn vs. c.COP5.6trn. The monthly increase in total holdings was just 0.7% vs. a 1.8% growth rate of the total COLTES market, which led to a slight decrease in holdings to 32.1% from 32.4% in February 2025. Nominal TES accounted for almost all of pension fund purchases with UVR inflows of just c.COP0.3trn.
-
Public Financial Institutions were the largest sellers with a reduction of COP0.8trn of COLTES in March. The outflow lowered their holdings from 4.0% to 3.8% of the market, with all outflows coming from nominal TES (-COP1.1trn), offset partially by inflows into UVR (+COP0.3trn).
-
Public Trusts also bought a considerable amount of COLTES in March (+COP1.8trn) driving allocation to COP52.5trn (+3.6% MoM). Holdings are 8.5% up from 8.3% in February. Nominal COLTES accounted for c.80.5% of total inflows, with the remainder going to UVR linkers.