GNB Eyes Bond Debut

Fresh off the $400m purchase of HSBC’s assets in 4 countries, Colombia’s Banco GNB Sudameris is preparing to meet bond investors in the US, Europe and Latin America ahead of a possible cross-border bond debut. The bank is scheduled to meet the buyside today in London and Bogota, followed by visits to accounts in Switzerland, Lima, New York, Santiago, Boston and Miami before wrapping up in Los Angeles Friday July 20. A dollar-denominated subordinated Tier 2 transaction may follow, market conditions permitting. Bank of America Merrill Lynch is managing the process. The proposed 144a/RegS transaction is expected to be rated Ba1/BB+. Last month, GNB agreed to buy HSBC’s operations in Colombia, Uruguay, Peru and Paraguay, for $400m, and subsequently received authorization to issue subordinated cross-border bonds. In assigning its BB+ rating, Fitch notes GNB’s robust asset quality, sound reserves, sufficient capital, ample liquidity, operating efficiency, and “moderate yet consistent” performance. These factors are weighed against low margins, concentrated deposits, and the challenges related to “ambitious” expansion plans, Fitch says. The outlook is stable.