Brazil State Gets $50m Road Loan

The IDB has extended a public, guaranteed $50m loan to the state of Santa Catarina to improve its state highways. The facility has a 25-year life and 3-year grace period, paying a Libor-based spread. In the first half of 2009, the spread over Libor for the project was equal to 30bp, implying an annualized rate of 60bp over Libor, though that spread is expected to be reset to a new level for the second half, say people familiar with the transaction. The financing covers 70% of the project costs. The funds are being used to repair, upgrade and increase safety of around 50km of roads linking the cities of Lindoia and Irani, and Sao Domingos and Bom Jesus.