Codelco Heard Mandating BBVA for Loan

Chile’s Codelco is rumored to have mandated BBVA to lead a $400m 7-year term loan, according to bankers not on the deal. The transaction was highly sought after and expected to set the tone for blue chips in this market, where margins continue to compress. Bankers away from the deal estimate the price will come somewhere between 13bp and 16bp over Libor, skimpy even for this market. Codelco, which is owned by the government, is one of the highest rated credits in the region, with an Aa3 from Moody’s.