BCP Launches Exchange Offer

Banco de Credito del Peru has launched an offer to exchange any and all of its $120m outstanding in 6.95% 2021 subordinated bonds for recently issued6.875% 2026 fixed-to-floating rate bonds. Holders must also waive a provision in the original notes that keeps the Peruvian bank from accepting more than $70m worth of bonds in such an offer. In the transaction expiring October 24, accepting holders will receive an equal amount of new notes, multiplied by an exchange premium to be announced at a later date. Those accepting before an October 7 early deadline receive an extra $30 per $1,000 tendered. The new notes are the same as those offered on September 8, in a $350m sale. The NC10 bonds pay a fixed coupon and switch to a rate of Libor+7.708% per year after year 10. Bank of America Merrill Lynch and Morgan Stanley ran the initial sale and are also managing the exchange offer. The 2021 notes were originally issued in 2006.