The State of Mexico is arranging a 19.9 year MXP610m enhanced loan from Banorte, which will pay a spread of 125bp over TIIE, which closed at 4.8450 yesterday. Moody’s has assigned a Baa3/Aa2.mx rating. The loan is payable through a trust, to which the state has pledged the flows and rights to 100% of its federal participation revenues and to 25% of its revenues from the Fondo de Apoyo para el Fortalecimiento de las Entidades Federativas. The rating reflects the underlying creditworthiness of the State of Mexico, which has a Baa2/A2.mx rating, as well as the features of the loan. These include a strong trust structure, estimates that cash flows generated will provide strong debt service coverage ratios, a moderate level of reserves and strong historical cash flows. The last rating action Moody’s took with respect to the State of Mexico was on August 27 2010, when Moody’s assigned ratings of Baa3/ Aa2.mx to its MXP2bn Municipal Lending Program.
Category: Loans
Oaxaca State Achieves Baa2 Rating
Moody’s has assigned a Baa2 rating to a MXP250m ($20m) enhanced loan the State of Oaxaca obtained from Scotiabank. The ratings reflect the creditworthiness of the state. The loan is denominated in MXP, with maturity of 10 years and a grace period of 12 months for principal payments. The loan will pay an interest rate composed of the 28-day Mexican interbank rate, plus a spread.
Venezuela, Argentina Get CAF Financing
Venezuela is getting 2 loans worth a total $700m from CAF, one for $600m to finance the Tocoma hydroelectric plant and the other, for $104m, to improve mass transit. CAF also approved a $500m loan for Argentina to be invested in an electric power line project. Terms were not released.
Micro Lending Rises 13%
A survey by the IDB’s Multilateral Investment Fund shows that microfinance lending in LatAm and the Caribbean rose 13% in 2009, lower than the 18% increase seen in 2008. Lending jumped to $12.3bn in 2009 after reaching $10.9bn in 2008 and $9.2bn in 2007. In terms of loan portfolio, Peru tops the ranking with $3.2bn of microloans. Ecuador is second, with a portfolio of $1.7bn, followed by Colombia, which has a total of $1.4bn in microloans. There are more than 700 microfinance institutions in the region, according to the IDB.
Brazil Sewage Gets IFC Financing
The IFC will provide BRL18.9m to Brazilian water and sewage company Cia. de Saneamento de Sergipe in what it describes as its “first subnational financing in Brazil without a sovereign guarantee.” The loan is for a 7-year term, has a grace period of 3 years and has an interest rate pegged to the local DI rate.
Pemex Gets Commitment on Jumbo Loan
Mexico’s Pemex has received a $75m ticket from EDC for the first tranche of its $3.25bn dual-tranche loan, according to bankers with knowledge of the deal. The first tranche is a $1.25bn 3-year revolver, to re-finance a loan that matured in September, for which it is offering 125bp over Libor. Bookrunners are Barclays, BBVA, Credit Agricole (admin agent) and RBS. It also wants a new money 5-year term loan for $2bn at L+150bp. BBVA (admin agent), BNP Paribas, Credit Agricole, Citi, HSBC and Inbursa are bookrunners. The revolver is to refinance a loan taken in 2007 for $1.25bn that was priced at Libor plus 20bp. Fees for participation in the revolver range from 25bp-60bp for $100m, $75m, $50m and $35m tickets. On the term loan, fees range from 45bp to 85bp for $150m, $100m, $75m and $50m commitments. Bankers say that of the 2 tranches the term loan looks more attractive. The deadline for commitments is October 13.
Banorte Lends To Oaxaca and Naucalpan
The Municipality of Naucalpan will receive an enhanced loan for MXN486m from Banorte. The loan has a maturity of 20 years and will pay a spread of TIIE plus 175bp. The loan will be used to refinance an existing loan at a lower cost. Moody’s has assigned a debt rating of Aa1 on a national scale. Banorte will also give the State of Oaxaca a MXP250m 10 year enhanced loan, to which Moody’s has assigned a Aa2 rating on a national scale. The loan will pay a spread over TIIE. The loans are payable through trusts, to which the municipalities have pledged the flows of a portion of their federal participation revenues. The ratings actions are based on the underlying creditworthiness of the states and the strong trust structures, as well as estimated cashflows.
CAF Deploys Loans to Panama, Argentina, Brazil
Multilateral bank CAF says it has approved loans for Brazilian electric company Eletrobras, Argentina’s railway system and Panama’s capital. Eletrobras will obtain a total of $500m in the form of an A/B loan. Of that amount, CAF will provide $125m, while the remaining $375m will be a syndicated loan from BBVA, Santander and HSBC. Argentina, meanwhile will get $326m, all from CAF, to improve railroad connections between the northern part of the country and the ports. Lastly, Panama’s capital city will get $120m from CAF to improve the sewage system. Terms for the loans are not disclosed.
BNDES Gives Loan To CPFL Energia
Brazil’s BNDES will give CPFL Energia a loan for BRL574m, though the development bank does not disclose the tenor. It will be used to build 7 wind farms in the state of Rio Grande do Norte, in the North-East of Brazil, which will generate a total of 188MW of power. The financing will also cover transmission. The loan represents a 71.6% share of the project, with the total value of the project being BRL801.8m, says the bank. It is estimated that the project will generate 1,500 direct and 4,500 indirect jobs, which will help to stimulate economic development in the region. “We are investing in wind power as it complements the hydro electric power we are already investing in, and will help to compensate for when reservoirs are not totally full,” says a spokesperson.
Brazil’s OSX Gets $420m loan
OSX Brasil has received an 8.5 year $420m syndicated loan at 425bp over Libor, according to a regulatory filing. The loan will go towards the purchasing and customizing of OSX-1 drill ship, it adds. The transaction was led by Norway’s DVB Bank, with Credit Agricole, Eksportfinans, GIEK, ING Bank, Santander and ABN AMRO also participating, says the borrower. OSX is privately owned and constructs, assembles and repairs floating units and vessels for oil and gas exploration in Brazil.