Titularizadora Colombiana is readying what is being touted as Latin America's first non-performing loan (NPL) deal. Holding a 5% guaranty from the International Finance Corp., the US$94 million-equivalent deal is heavily over-enhanced, according to Fitch Ratings Senior Director Gregory Kabance. "It's needed in a transaction like that," he said, speaking at the 3rd Annual Latin American Securitization Summit.
Even with a recovery ratio of 70%, the domestic transaction has an overcollateralization of no less than 60% and a subordination of at least 50% for two senior tranches. The originators on the transaction are Banco AV Villas and Banco Conavi. Fitch affiliate