CAF says it has agreed to offer Peru a $400m credit line to help it cover potential gaps in financing from the international markets and allow the sovereign to manage its public debt strategy. The multilateral also approved an $80m loan for the Dominican Republic to help the country develop its urban areas in 61 communities. Terms are not being disclosed, says a CAF spokeswoman.
Category: Bonds
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IDB Signs Barbados and Nicaragua Facilities
The IDB has approved loans for Barbados and Nicaragua. Barbados will get 2 facilities, one for $50m and another for $20m. The larger loan will help the Barbados Water Authority to modernize its infrastructure and improve efficiency. It has a 25-year term, a 5-year grace period and is priced basis Libor. The $20m loan will help raise agricultural health and food safety standards to international levels, it will have a 25-year term, a 4-year grace period and a variable interest rate based on Libor. Nicaragua, meanwhile, is getting $40.5m to improve tax collection and make social spending more efficient. The funding consists of a $20.25m loan from for a 30-year term, with a 5.5-year grace period, and a $20.25m loan for a 40-year term, a 40-year grace period, paying 0.25%.
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Brazil Municipalities Get IDB Support
The IDB has approved a $150m loan to finance the second phase of a multi-phase federal government program that seeks to help the country’s 5,564 municipalities better integrate their tax systems and modernize their administrative, tax, financial, and revenue management. The USD-denominated loan matures in 20 years and has 6-year grace and disbursement periods. The interest rate is based on Libor.
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Security Sells Local Bonds
Chilean financial conglomerate Grupo Security has issued UF750,000 ($31.7m) in 23-year bonds at 97.94 with a 4.50% coupon to yield 4.70%, says Hugo Horta, head of DCM at IMTrust, which managed the sale. The notes, which have a national rating of A+, have a grace period of 7 years, he adds. Originally, the company planned to issue up to UF1.25m, but Horta says it only needed UF750,000 to repay a previous bond.
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Costa Rica Airport Gets IDB Loan
The IDB has approved a $45m loan to help finance the expansion of the Juan Santamaria airport in Costa Rica’s capital city of San Jose. Paulo Monteiro, finance manager at Brazil construction company Andrade Gutierrez, part of the consortium in charge of the expansion, says that the loan has a 15-year term and 1-year’s grace. Monteiro declines to state the price. He also tells LatinFinance that the consortium, to which Canada’s Airport Development Corporation and Houston Airport Services also belong, expects to get another loan for $55m from OPIC in early January. The terms for that loan will be the same as IDB’s, he says.
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Argentina Gets IDB Power Line Loan
The IDB has approved $300m in financing to Argentina for the completion of a 1,220km 500kv power line, as well as to support provincial and regional transmission and sub-transmission works that are part of the country’s Norte Grande development and integration program. The new IDB financing will complement a $580m loan approved by the bank in 2006. The latest loan is for a 25-year term, with a 5-year grace period at a variable interest rate.
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Multilaterals to Co-Finance LatAm Projects
The IDB and the European Investment Bank (EIB) have reaffirmed their commitment to co-finance private-sector energy and transport projects in LatAm and the Caribbean. The new agreement renews commitments from both institutions that were set in a previous memorandum of understanding, signed in December 2004, which expires at end of 2009. Under the previous accord, the IDB and EIB have co-financed important projects for the region, including the expansion of the Panama Canal and Nicaragua’s power sector rehabilitation program. The total amount available for loans has not been defined, says an IDB spokeswoman.
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CAF Advances Vene Tap
CAF has been approved by Venezuelan regulators for a local bond of up to VEB1bn ($465m), according to the country’s official gazette. There are no specific plans for a local market issue, according to a CAF official. Despite addressing most of its 2009 financing needs with a $1bn 8.125% of 2019 dollar bond late May, the multilateral seeks to support the region’s domestic markets by issuing in local currency. CAF sold PES144m ($50m) in 6.5% of 2014 bonds in Peru’s local market in October and is working on a bond to sell in Uruguay.
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Nicaragua Gets IDB Loan for SMEs
The IDB has approved a $10m loan for Nicaragua so the country can assist small and medium companies increase exports and attract foreign investment. Half the loan will be for a 25-year term, with a 5.5-year grace period and a fixed rate. The other $5 million will have a 40-year term and grace period and an interest rate of 0.25%. The government of Nicaragua will provide $437,000 in local counterpart funds.
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Suramericana Sees Demand for Long Bonds
Demand for Grupo de Inversiones Suramericana’s bonds surged to COP1.3trn ($657.6m) Wednesday, according to a local DCM banker close to the transaction. The holding company sold COP250bn ($127m) as planned in 3 tranches. The 10-year notes, of which the banker says COP54.00bn was sold, pay IPC plus 4.40%; the 20-year, of which COP98.00bn was sold, pay IPC plus 5.90% and the 40-year notes, of which COP97.50bn was sold, pay IPC plus 6.98%. The banker says Suramericana is the first Colombian company to issue 40-year bonds. The longest tenor had been for notes issued by the government, which had a tenor of 33 years, he adds. Proceeds will be used to finance the company’s acquisition of its insurance subsidiary’s investment portfolio. Fitch has an AAA national rating on the issue. Bancolombia managed the sale.