After getting stuck in Mexico's debt pipeline, a Deutsche Bank-led deal backed by bridge loans for construction may come out this month in revamped form, according to sources familiar with the bond. "This could price as early as mid -September," one of the sources said. Backed with assets originated by Hipotecaria Su Casita, a senior tranche of the deal is being planned at Ps600 million (US$60.2 million) from an originally targeted Ps400 million (US$40.1 million), one source said.

Understood to have been tweaked in order to garner top-notch ratings, the deal has secured a Aaa' rating on the national scale from Moody's Investors Service. To alleviate investor discomfort with the bond in its initial form, the deal is being rated by all three agencies in Mexico. Fitch Ratings is heard giving the deal its second triple A'; Standard & Poor's is expected to issue its decision this week.

The paper carries a 7-year tenor and includes two subordinated tranches, a Ps71.4 million (US$7.2 million) piece rated Ba2 by Moody's and a Ps45.9 million (US$4.6 million) piece, rated Caa2. The deal will be priced over 182-day Cetes, the benchmark local treasuries.

Su Casita is Mexico's second largest SOFOL, a term used for special-purpose financial companies that provide bridge loans for housing construction and low-income mortgages.

The International Finance Corporation holds a 14.4% share of Su Casita.

Deutsche Bank is no stranger to the SOFOL market. In the sector's only transaction last December, the bank placed a Ps750-million (US$75.2 million) 2007. SOFOL Hipotecaria Nacional sold the rights on bridge loans into a trust that issued the deal. Banco Invex was the trustee and the paper priced at 182-day Cete treasurys + 165bps.

Local brokerage IXE Casa de Bolsa is heard busy preparing a SOFOL transaction as well. Also floating rate, that deal is expected to come at Ps500 million (US$50.2 million), with a 7-year maturity. Moody's has rating the bond Aa2' on the national scale. Backed by loans from Metrofinanciera, the deal consists of single tranche and is slated for this month, said one source. Metrofinanciera is the seventh largest SOFOL in Mexico in terms of loans extended and capitalization.

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