Colombia Freezes as Interbolsa Hits Hottest Market: Andes Credit

The collapse of Colombia’s largest brokerage is burning foreign investors who piled into what had been one of this year’s hottest emerging markets.

Yields on $5 billion of dollar bonds sold by Colombian banks have jumped since the government was forced to take over Interbolsa SA’s brokerage this month, pushing up borrowing costs by an average 26 basis points, or 0.26 percentage point, from a record low on Oct. 17. That’s about five times the average increase in yields of emerging-market financial institutions’ bonds in the same period, according to JPMorgan Chase & Co.