Cartagena Signs Syndicated Loan

The government of the Colombian state of Cartagena has signed a COP120.5bn ($58m) syndicated loan to support its 2009-2011 tourism development plan. The 7-year facility will a pay an interest rate of the DTF benchmark plus 3.5%, reached through an auction process usually seen in the bond markets. “We’ve set a new standard for municipal financing in the bank market,” says Julio Torres, partner at boutique investment bank Nexus, which arranged the transaction. Torres says that oversubscription on the deal enabled the rate to be brought down from an initial DTF plus 4.0%. Bancolombia, Banco de Occidente, Banco Popular, BBVA Colombia and Banco GNB Sudameris participated, though Torres declines to indicate the size of individual allocations.