Mexico Sofom Preps Dollar Bond Debut

Mexico’s Credito Real is preparing to sell $150m in 2015 unsecured bonds, in what would be the payroll discount lender’s dollar DCM debut. The BB minus rated deal is expected by the end of this week, and follows limited “non deal” investor meetings in the US and Europe that finished last week. Real is likely facing a yield of around 10%, if last month’s $200m 2015 deal from compatriot lender Financiera Independencia (Findep), also rated BB minus, is any indication. That microfinancier priced at par to yield 10%. Bank of America-Merrill Lynch is leading Credito Real, after managing the recent meetings. “The ratings on Credito Real reflect a high dependence on volatile funding sources – market debt – with support from adequate asset quality, and improved and stable profitability and adjusted capitalization,” S&P says in a report. Real is a frequent, if not large, issuer in its domestic market, having sold MXP1.62bn in 2009 in 4 sales throughout the year. Several high-yield Brazilian financial institutions have raised funds in the dollar markets since the reopening last year, but Credito Real would mark only the second out of Mexico, after Findep.