VW Bank Prices MXP Debut

Mexico’s Volkswagen Bank has raised MXP 1bn ($71m) in a domestic bond debut, pricing a 3-year floater at TIIE + 50bp. Private banking accounts and mutual funds mostly participated, allowing the issuer to see 1.4 x demand. VW’s pricing is being compared to Daimler, which in September, priced a MXP1bn 3-year bond at TIIE+50bp. The car manufacturer then saw demand reach 1.4x and also priced against talk of TIIE + 40-50bp. “Despite volatility in the market, pricing shows there is liquidity in Mexico,” says in banker familiar. VW has a MXP7bn program, and is expected to become a frequent issuer going forward. The bonds, rated AAA on a national scale, will be guaranteed by parent Volkswagen Financial Services. HSBC and Santander managed the transaction.