Citi and Santander have launched a program to securitize trade finance assets originated by the two banks.

Called "Trade MAPS," the program allows banks to get receivables off of their books, freeing them up to provide more financings, according to a press release jointly issued by the two banks.

The inaugural $1 billion issue consisted of four classes of three-year notes, all of which were rated by Standard & Poor's and Fitch Ratings. Citi, Morgan Stanley and Santander were the Joint Book Runners.

An $874.4 million tranche of triple-A rated notes were sold at one-month Libor plus 70 basis points; a $77.6 million tranche of single-A rated notes were sold at Libor plus 125 basis points; a $313.3 million tranche of triple-B rated notes were sold at Libor plus 225 basis points; and a $16.6 million tranche of split-rated notes were sold at Libor plus 500 basis points. This last class was rated “BB” by S&P and “B” by Fitch.  

A $41.1 million, unrated equity tranche was retained by the originators, with Citi holding $14.8 million and Santander holding $26.3 million.

The Trade MAPS Program uses a multi-jurisdictional structure created by Citi that enables both Citi and Santander branches or entities domiciled in Asia, Latin America, Europe, Middle East and North America to sell trade finance assets via multiple special purpose entities or trusts.  These entities then fund themselves through an offshore special purpose entity, Trade MAPS 1 Limited.

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