Bancomer Aims Below 7%

BBVA Bancomer is heard targeting a yield in the mid to high 6%-area for a benchmark-size 10-year subordinated Tier 2 bond, pricing as soon as today. The A1/A minus rated Mexican bank was scheduled to wrap up a 7-day roadshow in Los Angeles and Chicago on Wednesday after visiting Asia, Europe, Latin America and the US. Proceeds will be used to strengthen the bank’s capital structure and for general corporate purposes. Bancomer’s subordinated 2021 bonds, trading at 6.10% Wednesday, offer a direct comp, as do other recent Tier 2 issuances from Colombian and Brazilian banks. BBVA, Bank of America Merrill Lynch and Goldman Sachs are managing the transaction, rated A3/BBB.