Banco do Brasil Targets CHF Debut

Banco do Brasil is scheduled to meet Swiss investors today ahead of a possible Swiss franc debut bond issue, according to people familiar with the matter. Banco do Brasil, Credit Suisse and Commerzbank will manage the one-day roadshow in Switzerland. Banco do Brasil is considering a minimum benchmark size, likely CHF200m ($220m), with a 5-year or 6-year tenor. Some price discovery will be in order for the state-owned bank, as close comp BNDES’s 2016 CHF bond has a shorter tenor and is less liquid. The BNDES 2016 was seen trading at a bid to mid-swaps of 150bp Friday. Banco do Brasil could target pricing as soon as Tuesday, but timing depends on investor appetite for the Baa3/BBB rated credit and arbitrage opportunity. Banco do Brasil was looking at a Japanese yen-denominated bond issue in the international market earlier this year, but the deal is expected to take more time to get done due to Japanese investor concerns about the economic situations in both Brazil and Japan. Banco do Brasil, JPMorgan, Citi, Mizuho and Mitsubishi UFJ-Morgan Stanley are working on the euroyen transaction. The bank held non-deal fixed-income investor meetings in Asia in September with JPMorgan. CFO Ivan Monteiro told LatinFinance earlier this year the bank would focus on diversification of debt funding this year, with Japan and local LatAm currencies such as Chilean pesos among the options beyond euros and dollars.