Category: Peru

Peru’s Interbank has secured $200m in MT-100 future flow securitization in a highly private transaction that resembles a loan more than it does a bond issue. Credit Suisse, the underwriter, took the majority of the 7.5% 7-year notes onto its own books, a person close to the issuer tells LatinFinance. Interbank had been rumored to be seeking $150m in the MT100 market, along with compatriot bank issuer BCP, which is in the process of placing $150m via Wachovia and Standard Chartered. BBVA Continental is also heard to be bringing a $200m issue via Sumitomo Mitsui in July. These future flows deals are usually placed privately with institutional investors and insurance companies. Interbank also recently pulled a $200m 3-year syndicated loan from the market when would-be lenders declined to take tickets in the deal, demanding higher margins. An executive close to the issuer says the bank will look to satisfy that financing need with issuances in the local bond market and an international sale of notes. Credit Suisse is a likely underwriting candidate for any future cross border business, given its commitment to Interbank through the MT100 deal.

Scotiabank has signed an agreement to acquire a 47.5% stake in the private Peruvian pension fund Profuturo for $33m, the Canadian bank says. Scotiabank will be working in partnership with a group of Profuturo’s existing local shareholders to manage the company, it adds. Founded in 1993, Profuturo is the fourth largest private pension fund in Peru, with 23% of the market’s pension fund customers and a 17% market share of the system’s revenues, Scotia states.

An increase in local markets exposure and reduction in cash balances has prompted JPMorgan to cut its assessment of external EM debt technicals to positive from very positive. It dropped Peru to negative from neutral as investors sharply hiked exposure. “Peru spreads trade well inside their current credit rating, reflecting strong expectations of an imminent upgrade to IG by a second agency (Fitch already rates them BBB-), but with Peru’s weight in IG indices significantly smaller than for Brazil, should they qualify, the arguments for forced buying of Peru to minimize tracking error are weaker,” says the shop. It revised Colombia technicals to negative from neutral as exposures continue rising, while Venezuela was chopped to neutral from positive. JPMorgan adds that the remaining $18bn in scheduled sovereign debt issuance will be met by index cashflows of a similar magnitude. According to JPMorgan, inflows for the past month totaled under $1bn, the bulk of which was invested in local markets. It estimates year-to-date inflows into EM FX and fixed income from strategic and retail sources at $9bn. JPM also revised its full year 2008 inflow forecast to $30bn from $40bn. “External debt inflows have disappointed thus far this year, and outright outflows were even seen in retail external debt mutual funds. However, we remain optimistic on inflows into local markets,” says the shop.

Fitch has assigned an A minus rating to Banco Credito del Peru’s planned $150m issue of MT100 bonds. The 2015 notes, backed by future electronic payment receivables, are expected to be split into fixed- and floating-rate tranches. The sale managed by Standard Chartered and Wachovia is expected in July.

Spanish oil company Repsol-YPF has signed an agreement to sell Ecuadorian gas station operators RECESA and Oiltrader to Peruvian counterpart Primax for $47m, Repsol says. The purchase includes 123 gas stations in Ecuador, as well as Repsol’s lubricants and aviation fuel operations, infrastructure and industrial sales business. The transaction is expected to close in Q3, Repsol says, pending approval of the Ecuadorian regulators.

Peru’s Interbank has canceled the syndication of a loan after it became clear that interest in the $200m 3-year step up was not sufficient to get a full book, say bankers away from the transaction. The deal via Standard Chartered was originally launched as a 3-year working capital facility paying 85bp-95bp over Libor. It was then restructured and flexed so that a $100m 3-year trade facility offered 85bp-95bp, and a $100m 3-year working capital portion paid 100bp-120bp over Libor. That still did not do the trick, and the borrower was forced to exit. Bankers close to the process say the Interbank plans to come back when conditions are more amenable. Interbank is also lining up a $150m 5-year MT100 though Credit Suisse.

Banco de Credito del Peru is preparing a private placement of $150m in 2015 bonds backed by future payment receivables. The transaction is expected by mid-July. BCP has about $880m in MT100 notes outstanding. Wachovia and Standard Chartered are managing the sale. Separately, BBVA Continental is readying its first MT100 issue, a $200m private placement via Sumitomo Mitsui. Interbank is meanwhile planning a $150m issue through Credit Suisse, expected to have a tenor of around 5 years.

Volcan Compania Minera, the Peruvian miner, is heard out with an RFP for a $200m loan, say bankers in the syndicated market. The 65-year old miner specializes in zinc, copper, gold, silver and lead. No banks are heard to have been mandated yet.