The IDB has approved a $2bn credit line for Mexico to help it reduce poverty levels. An initial loan of $200m within the conditional credit line for investment projects will be provided. It is for a 25-year term with a 2-year grace period, at an adjustable interest rate based on Libor. Mexico’s Sedesol will carry out the program through the national Oportunidades coordination board. This operation is the third to Mexico for Oportunidades since it was launched in 1997. Two previous IDB loans totaled $2.2bn, says the bank.
Category: Structured Finance
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CAF Returns to Colombia Debt
CAF has returned to Colombia’s local market with an oversubscribed bond issue at apparently attractive levels. It issued Tuesday COP245bn ($110m) total, split between an 11.25% of 2013 and an 11.79% of 2018. Pricing was equivalent to 65bp over TES, Gabriel Felpeto, CAF’s director of financial policies and international issues tells LatinFinance. Other Triple As priced recently at 100bp-120bp over TES and 65bp was in line with the target, he adds. “We are very happy with the transaction given the environment,” says Felpeto, who adds that it was 2.4x subscribed. Some 50 investors participated, including pension funds, insurance companies, banks and asset managers. The deal through BBVA was the debut from a COP1trn 3-year CAF program and the first from the multilateral since 2004. This week’s issue was geared at boosting Colombia’s domestic market, but Felpeto says it was also attractive in terms of price, at just 5% equivalent coupon in dollars. “We were asked by the ministry of finance to issue in that market. They need some more issuers to help investors diversify,” says the official. The offer was not rated locally, but based on the international grading, the offer would have been a Triple A.
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IDB Loans $80m to Uruguay
The IDB has approved a loan of up to $80m to Uruguay so it may improve its sewer service. An initial loan of $43m will be used by the country’s National Water Supply and Sanitation Administration and the IDB could approve additional financing for a total of $80m. The loan is for 25 years with a 4-year grace period and an adjustable interest rate. It will be disbursed over a four-year period. Local counterpart funds for the program total $39.5 million.
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IDB Funnels Funds into Argentine Wineries
The IDB has approved a $50m loan to Argentina’s government so it can help small-scale grape growers boost income and carry out investment plans. The program will be carried out by the Argentine Agriculture Department and Coviar, a public-private corporation that promotes Argentina’s wine and grape industry. The loan, which was approved on December 10 by the IDB’s board, has a 25 year tenor, with a five-year grace period and an adjustable interest rate. Local counterpart funds for the program total $25m.
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Peru’s BCP Targets $150m in DPR Bonds
Banco de Credito del Peru is looking to place $150m in notes backed by diversified payment rights (DPR), say people close to the deal. The Series 2008-B bonds, which have received a preliminary A minus rating from Fitch, are being placed by Sumitomo Mitsui. They are a follow up to the bank’s 2008-A series, of which another $150m were issued in July. The bonds will have a floating interest rate and will bring BCP’s total outstanding DPR stock to $1.1bn, according to Fitch. BCP executives declined to comment on the private deal, saying it has not yet closed. The offering is likely to be done through a private placement with banks or vehicles controlled by financial institutions, speculates one structured finance specialist who is not involved in the deal. While MT-100, or DPR sales tend to be private, illiquid deals, they have accounted for a substantial portion of the total bond issuance done in LatAm this year. The structure is reserved for high quality issuers and proceeds can be used for general corporate purposes. In Brazil alone this year, the total issuance of DPR notes has topped $2bn, according to one DPR expert’s calculations.
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BBVA Lands MBS, Sub Notes
BBVA Bancomer has sold MXP5.5bn in mortgage backed securities and MXP3bn in subordinated bonds. The 2030 9.91% MBS have a 22-year term, say people on the deal. The 2020 subordinated bonds have an average life of about 12 years and were priced to yield 9.74%, or 100bp over 28-day TIIE rate. BBVA self-led the deal.
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IDB Supports Bahia
The IDB has approved a $409m loan to Brazil’s Bahia state to implement a fiscal modernization program that will include measures to boost tax collection, improve spending controls, and enhance its public debt profile. A first disbursement of $209m will be used to improve the public debt profile and cut payment service by eliminating the residual debt obligations stemming from a 1997 debt agreement with the federal government, says the IDB. A second disbursement of $200m will support improved fiscal management measures, helping the state meet the goals set in its fiscal adjustment program and in the fiscal responsibility law. The loan will help improve cash management, enhance mechanisms to boost tax collection on the state’s vehicle property tax, as well as finalize the implementation of a debt management system and an electronic tax invoice system for large taxpayers.
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IDB Extends Credit Line to Colombia
The IDB has announced that it has approved a $650m credit line to Colombia to help Bancoldex finance investment projects and develop exports. It will initially receive a $100m loan. It will also receive an additional $650m from the local government. The loan is for a 25-year term with a 4-year grace period at an adjustable rate based on Libor.
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IDB Provides Caribbean PCG; Sao Paulo Funds
The IDB has established a $200m partial credit guarantee facility to support FirstCaribbean’s long-term loans to infrastructure projects, tourism ventures and mid-size businesses. The facility, denominated in USD or local currency, will be available for 3 years to support at least $400m in FirstCaribbean lending to private sector borrowers. The IDB says initially the facility will focus on transactions in Jamaica, and later expanded to the Bahamas, Barbados, Belize and Trinidad and Tobago. Separately, the IDB has approved a $194m 25-year loan to the state of Sao Paulo to improve its roads network. The program will be carried out by the Sao Paulo state highways department and the loan has a 5-year grace period and is priced basis Libor.
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Titularizadora Colombiana Places MBS
Colombian securitization shop Titularizadora Colombiana has sold COP236bn ($100m) worth of MBS locally with institutional investors. The 2018 notes have an average life of 2.2 years and were priced at par to yield 5.99% over the UR inflation-linked index, says Mauricio Amador, vp of finance at Titularizadora. The rate was determined through an auction held Wednesday, whose maximum level was 6.50%. The notes are backed by mortgages originated by Bancolombia, AV Villas, Colmena and Davivienda. Half the issue was done Wednesday with pension funds, trusts and financial institutions, while the remainder will be underwritten and placed with banks, including those who originated the mortgages. The 2018 senior notes are rated AAA on a national scale. Nine Colombian banks and brokers served as placement agents. Titularizadora is considering issuing another batch of MBS before year-end, says Amador. The deal would involve the sale of fixed rate notes and likely be larger than yesterday’s $100m issue.