Colombia’s Banco Popular is lining up the sale of a 12.11% stake in a June 10 deal that could raise $140m. The bank will offer approximately 953m shares at COP265 each on the Bogota stock exchange. It was trading at COP280 Friday. The seller of the stake is the federal government and district of Bogota, and the deal is aimed at both local and foreign investors, Daniel Isaza, manager at bookrunner Agora tells LatinFinance. Earlier this year, Popular sold 1.37% of its shares to Colombian pension funds and its own employees, Isaza adds. Colombian stockbroker Correval will act as placement agent. Grupo Aval controls 83.7% of Popular, with other Colombian states, pension funds and municipalities maintaining a minority stake.
Category: Regions
Posted inDaily Brief
Colombia Ramps Up Capital Controls
Aiming to stem further COP strength, Colombia has increased the non-refundable deposit amount required for foreign investors in the country to 50% from 40%, the ministry of finance says. At the same time, it has established a 2 year minimum permanence requirement for FDI entering the country, the ministry adds. The measures come days after the executive manager of the Colombian central bank, Gerardo Hernandez, advocated for a more flexible framework for foreigners to invest in the country. “This is a negative development inasmuch as it moves the current policy approach from what has been seen and recognized as investment-friendly further into the heterodox camp,” says Goldman Sachs. It adds that international experience shows that capital controls seldom work, and when they do the cost attached to them can be quite significant.
Posted inDaily Brief
LatAm Equity Sees Minor Gains
LatAm equity funds gained 0.54% in the week ending May 29, according to Lipper. EM funds dropped 0.93%, while China region funds sank 2.20%. Commodities fund saw the biggest drop of the week, losing 3.33%, while global science/technology funds saw the biggest returns, with 1.88%. LatAm equity funds last week suffered redemptions, according to EPFR Global.
Posted inDaily Brief
BBVA Panama Seen Upping Loan Portfolio
S&P has revised upwards its outlook on BBVA Panama to positive from stable and affirmed the long and short-term counterparty credit ratings on the bank at BBB minus and A minus 3, respectively. “The outlook revision reflects BBVA Panama’s ability to increase its loan portfolio and deposit base in a very competitive environment, while maintaining its overall financial profile and progressively improving its business profile,” the agency says. S&P expects the shop to continue to maintain good financial performance and asset quality. “However, the ratings are constrained by a concentrated loan book and the risks of operating in Panama, such as stiff competition, high individual indebtedness, and the absence of a lender of last resort in the country,” S&P says.
Posted inMagazine
The Rise of the Iguana
Colombia’s Ecopetrol seeks to reinvent itself as a leading LatAm oil company. It is channeling investment into E&P and biofuels, backed by strong cashflow. by Julio Urdaneta
Posted inMagazine
Electrifying Peru’s Progress
The fastest growing LatAm economy faces crisis in 2011 if it does not revamp its electricity sector. However, new investment could turn Peru into a power exporter. by Lucien Chauvin
Posted inMagazine
Fishing Yield from Choppy Waters
Mexico’s third largest pension fund is turning to foreign markets for opportunity. It wants access to derivatives in the domestic market. by Greg Brosnan
Posted inDaily Brief
Fitch Mulls Mabe Downgrade
Fitch has placed Mexican home appliance manufacturer Mabe’s BBB minus rating on watch negative, including senior notes due 2015. The action reflects risk and uncertainty following the recent announcement from GE, its major stockholder that it is reviewing strategic options for its appliances business, which include a strategic partnership or joint venture, spin off or sale of the business. Last week S&P also placed Mabe on credit watch negative. Meanwhile, GE chief executive Jeffrey Inmelt has named Mabe as one of the potential buyers of its appliance business, wires report.
Posted inDaily Brief
Rift with Oil Companies Could Hurt Ecuador
An extended stand off over a new service contract between the Ecuador government and foreign oil companies could translate into a freezing of investment and a decline in output revenue, according to Analytica Investments. “The state owned company is not doing what it takes to maintain production levels,” says Eduardo Checa, analyst at the Ecuador-based shop. Even though oil income is sinking due to a lack of investment, and remittances from the US and Spain have dwindled, high commodity prices maintain decent local liquidity, the analyst adds. Ecuadorian oil minister Chalo Chiriboga announced this week that the government expects foreign oil companies to move to a new service contract scheme by September.
Posted inDaily Brief
Mexico’s Banorte Plans MXP3bn Sub-Debt
Mexico’s Banorte plans to sell about MXP3bn of tier-2 subordinated debt, followed by a state and municipal debt securitization to the tune of MXP5.5bn later in the year, investor relations officer David Suarez tells LatinFinance. A roadshow for the sub-debt is planned for June, with Banorte’s own DCM desk handling the sale. Suarez says the issue will likely be a 10-year non-call 5 and is hoping for pricing of 50bp-100bp over TIIE. Banorte, Mexico’s fifth largest bank and the only large locally owned financial institution, sold MXP3.6bn in 10 and 20-year bonds in a similar deal in March, pricing a 2018 tranche at 60bp over 28-day TIIE. Suarez says the upcoming deal will likely price wide of that. “Conditions were much better in March, because there were expectations that rates in Mexico were going to come down,” he says. “The yield curve has shifted upwards and the long part of the curve is more expensive now,” he says. “It’s probably going to be a higher interest cost, but it’s still going to be below the average for Banorte’s cost of capital.” Suarez says the debt sale will be tier two because the bank’s tier one window is almost full. There is no date set yet for the state and municipality debt securitization.