Banorte Eyes Subordinated Bonds

Mexico’s Banorte is planning an issue of up to MXP5bn in 2019 and 2021 subordinated bonds, according to officials at the bank, a soon as this week. The bank can issue up to MXP2.5bn in each of 10-year and 12-year tranches, priced basis 28-day TIIE. Proceeds will be used to refinance debt due this year. The notes are rated Aaa/AA+ on a national scale and Banorte’s own brokerage is managing the sale. The bank sold MXP2.75bn in 10-year bonds from the same program in June, at TIIE plus 77bp. The issue is seen as a test for bank bonds and for corporate issues that might follow. Elsewhere, Bancomer still awaits a window to issue up to MXP3bn in 2-year notes, while Santander last week sold MXP1.2bn in 13-year subordinated bonds backed by government securities.