Lebanon’s Bonds Escape Infamous 20-Cent Club as Reform Bets Grow

Lebanon’s defaulted bonds have risen above 20 cents on the dollar for the first time in five years as investors wager the country’s political and economic reforms are gaining momentum.

That leaves Venezuela as the only country with sovereign bonds below the 20-cent threshold, which some investors associate with the world’s most dysfunctional credits.

Lebanese 2035 dollar securities rose to 20.7 cents on Wednesday, with nine of the country’s securities figuring among the top 20 gainers in emerging markets. The bonds have posted a total return of 250% since September last year, five times as much as the second-best ...