In June 2025, we shared our outlook on opportunities in Chilean corporate debt denominated in U.S. dollars (SEE), in a context where we saw attractive spreads, solid fundamentals, and a macro environment in the process of normalization. Nearly a year after that recommendation, it is worth revisiting this thesis, not only because the results validate it, but also because its main drivers remain fully in place. During this period, the strategy not only outperformed the market but did so with lower risk, establishing itself as one of the most efficient exposures within the USD fixed-income market. 

Since its initial launch, the recommended portfolio has outperformed the global corporate bond market in USD, both in terms of return and risk. During this period, the strategy generated a return of 7.5% vs. 4.5% for the benchmark, with significantly lower volatility (1.8% vs. 3.9%) and a Sharpe ratio of 2.9 vs. 0.4. Simply put: it generated higher returns, with less pronounced declines and much more stable performance, validating the selective approach to Chilean corporate credit. 

This performance was no accident. A key part of the original thesis was that spreads offered an attractive entry point relative to regional peers, a trend that has indeed materialized. This was complemented by solid performance from issuers, with results in line with or exceeding expectations, healthy balance sheets, and strong repayment capacity—factors that supported both the carry and the portfolio’s stability. 

At the same time, the macroeconomic outlook has begun to align with expectations. The fiscal debate today shows a significant shift. Last week, President Kast signed the National Reconstruction and Economic-Social Development Bill, which outlines a structural fiscal adjustment after explicitly acknowledging the deterioration of public finances in recent years—with a structural deficit in 16 of the last 18 years and a debt totaling USD 155 billion.  

More importantly, the adjustment is already underway: The Treasury has estimated that USD 2 billion in fiscal spending cuts by 2026, as part of a total committed package of USD 3 billion. While the legislative process will be the main focus in the coming months, the underlying message is clear: the fiscal anchor is being strengthened and the perception of country risk is improving, a key factor in the appreciation of USD-denominated assets. 

But perhaps most importantly, the medium-term fundamentals remain intact. Chilean corporate bonds continue to trade with spreads above its Latin American peers, suggesting that there is still room for compression in an environment that is gradually becoming more constructive. In a world where global spreads are compressed, this type of risk-adjusted carry is becoming increasingly scarce. 

This is further bolstered by significant structural support from the real economy. We maintain a positive outlook on copper and lithium, where we see growing structural demand against persistent supply constraints. For copper, this translates into projected deficits into the next decade and upward revisions in prices; for lithium, a market that could remain in shortage until at least 2030. This environment directly strengthens the balance sheets of exporters listed in USD. 

Within this sector, the banking sector remains the main focus of the thesis. Chilean banks combine high capitalization (with significant buffers above regulatory minimums), good asset quality, and solid profitability, along with spreads that remain attractive in relative terms.  

Added to this is the implementation of Basel III as a structural catalyst, which reduces capital reserve requirements—by requiring banks to set aside less as a buffer, they are left with more capital available to lend and grow, further strengthening their balance sheets. 

With this in mind, we have adjusted our selection of issuers to better capture current opportunities. We maintain a significant core position in banks, where we continue to see the best balance between risk and return, and we have added exposure to copper (Antofagasta), lithium (SQM) and retail (Falabella, after regaining investment-grade status). At the same time, we are reducing exposure to issuers where the return no longer adequately offset the risk. 

In short, the evidence is clear: the thesis was validated by the results, the foundations have been consolidated, and the environment remains favorable. 

In a context where spreads still offer relative value and the key drivers remain intact, Chilean corporate debt denominated in USD remains an attractive option within the global fixed-income market. 

DISCLAIMER.

Felipe de Solminihac 
Head of Strategy