Cofide Selects Banks on External Bond

Peru’s Cofide has mandated Deutsche Bank and JPMorgan to issue up to $500m in 10-year bonds. The development bank plans to sell the paper in the latter part of the year, but may issue earlier depending on how the Humala administration’s economic policies evolve. This would be the borrower’s debut offering in the international capital markets. Plans for a foreign debt issue have been on the table since last year when the borrower was expected to raise $200m-$300m through a 10-year to lend for infrastructure projects. Other funding options under consideration were local debt issues and a foray into the Japanese market. In 2010, Cofide closed an amendment and restatement of a $160m 3-year loan coming with pricing at 125bp over Libor, but with a smaller size than the $185m it had originally sought after European banks were constrained by rising funding costs.