Development Bank Aims for Dim Sum

Issuance of offshore Chinese rinimnbi (RMB) bonds, or Dim Sum bonds, is coming back into focus for LatAm bond issuers, with Central American development bank Cabei adding itself to the list. Cabei is considering a RMB300m-RMB500m ($48m-$80m) transaction with a 3-year or 5-year tenor in what would be its debut in the market, Treasurer Jose Felix Magana tells LatinFinance. It sought to issue in the offshore RMB market last year, but held back as it wanted to first see improvements in swap rates. The issuer has yet to select banks and expects to do so early next year, he says. It has looked at America Movil’s and Korea Development Bank’s RMB-denominated transactions as two interesting reference points for exploring the market. Cabei is also considering a euro-denominated issuance and a Mexican domestic market transaction in the near future. The MXP transaction would likely be a 5-year sale of up to MXP1.5bn in 2Q 2013. Cabei is coming off of an S&P upgrade to A from A minus in August. Cabei’s most recent international bond was a $250m 2017 dollar bond, priced to yield 4.075% in February. Fellow development bank CAF is also looking at a Dim Sum bond. Santander Chile held investor meetings in Hong Kong and Singapore last week, and is said to be still in discussion with investors for an issuance as soon as this week. Deutsche Bank, Goldman Sachs and Standard Chartered are managing. America Movil was the regional debutant in the market in February, and was followed by Banco do Brasil.