Latam CAF eyes euro, US dollar bond markets for benchmark

jueves 28 de mayo de 2015 13:35 GYT

By Paul Kilby

NEW YORK, May 28 (IFR) - Latin American development bank CAF, rated Aa3/AA-/AA-, is considering a euro or US dollar bond sale following taps in Australian and Norwegian markets this month.

"We have room to raise about a US$1bn more this year," Aureliano Fernandez, a senior specialist in international bond issues at CAF, told IFR.

"So we will probably be aiming at a benchmark size transaction in the coming month, which could be in euros or dollars."

CAF recently completed a US$1bn benchmark three-year bond sale in January so it may prefer to hold off on a dollar trade and focus on euros first, he said.

Timing, however, will very much depend on costs and market conditions as there has been "a lot of volatility and that has implications for the swap" back to dollars, he added.

The borrower's recent NKr1bn (US$128m) 20-year bond sale, which was closed in early May, came inside its dollar curve, after pricing at par to yield 3.05% or about the equivalent of six-month dollar Libor plus 80bp, said Fernandez.

The deal, which was led by HSBC, extended CAF's curve in a market that it has already tapped twice through Deutsche Bank.

In February 2014, it raised NKr1.5bn through a 12-year priced at par to yield 4.29% and NKr900m with a 10-year that came at par to yield 4.07%.   Continuación...