Been there, doing that

The view that September’s debut sovereign bond put the
Dominican Republic on the map for investors is widely held. But not
by Peter Wallin, senior vice president of Standard New York
Securities, an affiliate of Standard Bank London, part of a South
African banking group. Based in Miami, Wallin has been a ‘DR
watcher’ for several years.

Standard has been involved in transactions with several borrowers
in the Dominican Republic, enjoying good business while most rivals
have been looking at bigger markets.

About two years ago, says Wallin, Standard was behind a $30 million
Euro CD program for Banco Intercontinental, the Dominican
Republic’s second largest private-sector bank. “It was the first
example of anyone doing anything in the DR. Since then we have
raised the program to $50 million and have been very successful in
attracting attention to a different market. They [Intercontinental]
are known outside now and all of the money was placed outside of
the country.”

Standard has also been involved with Tricom, the NYSE-listed
telecoms company from the Republic. Currently, Standard is putting
together a $200 million medium-term note (MTN) program for Tricom.

“It is really a combination of an MTN program and a Eurocommercial
paper program. It gives the ultimate flexibility of issuing
short-term or medium-term in one program,” explains Wallin. “For
the price of one program you can get both. If the market is not
very favorable in the medium term you can take advantage of the
up-to-one-year market with appropriate documentation for Euro CP.
We will go to market as soon as we see an opening.”

Wallin says Tricom will get a lot of visibility particularly
because of their strategy of going into Central America, where
Standard has also been active. The region is small – but at least
it is free from Argentine contagion.

“Nobody followed the DR and nobody cared too much. It was off
everyone’s radars. We went in and even hired analysts to follow it
because we had mandates with Intercontinental and Tricom. We also
did an issue with Banco BHD, partially owned by [Banco] Sabadell
[of Spain], and we tried to participate in the sovereign issue but
that was given to Morgan Stanley and JP Morgan,” Wallin recalls.

“The DR unbeknownst to most has managed its economy very well. It
has been the fastest-growing economy of the last two or three years
in Latin America but nobody cared because everyone was looking at
the Big Three [Brazil, Mexico and Argentina]. Well, two of the
Three have dropped out of the picture and people have time to look
now. I think that is why they were relatively successful with the
placement of the $500m bond.”

And what about the view that private issuers will henceforth be
helped by the benchmark set by the sovereign bond? “I think we
helped the sovereign, to be honest,” says Wallin.