Just as talk emerged that Banco do Brasil would soon revisit the markets with a privately-placed securitization (see ASR 3/3, p.21), the issuer snuck right in. According to sources, the deal is sized at US$120 million and was expected to close at the end of last week. Maturity is five-year average and seven-year final. Unlike an upcoming MBIA-wrapped transaction by peer Banco Itau, the transaction is naked, mirroring a previous issue from the program done in September. Merrill Lynch is heard leading the current issue, with Dewy Ballantine as legal counsel. Pricing is apparently coming tight to the spread of 475 basis points shelled out by the bank for last September's deal, a strong sign that the marketplace has reopened for Brazilian business.

Handled by ING Financial Markets, the previous deal was a US$40 million transaction rated Baa1' by Moody's Investors Service. Teachers Insurance and Annunity Association and its affiliates reportedly snapped up the entire deal.

That transaction slipped through shortly before markets froze out Brazilian issuers ahead of presidential elections in October. Investors felt that popular candidate Jose Inacio Lula da Silva would trample over them if he won. More than two months into his term, Lula's measured rhetoric and policy moves have impressed market participants and they have correspondingly warmed up to the prospect of crossborder activity from Latin America's giant.

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