Araucana to Issue Bonds Today

Chile-based financial institution Caja de Compensacion La Araucana is planning to issue CLP10bn ($21m) in local 5-year bonds via Dutch auction. Proceeds of the A rated bonds will be used to refinance debt and to offer credit to clients. Itau Chile will manage the sale. Bankers off the deal say it could price in an area similar to last week’s issue of financial services company Factorline, which issued CLP10bn in 4-year bonds at 122bp over BCP. “Araucana’s bonds could have a spread of around 120bp-140bp over BCP,” one banker says.