It has already been a busy year for Italy's robust ABS pipeline. Merrill Lynch and Depfa-Bank Europe plc recently launched EURO400 million ABS notes under Cartesio S.R.L. These notes are the first tranche of a total of EURO1 billion asset-backed euro MTN program to be launched. The notes are secured on a loan made by Merrill Lynch to Treno Alta Velocita; SPA (TAV). The Italian state railway guarantees TAV's obligations, which in turn is guaranteed by the Republic of Italy.

The loan is to be used by TAV to finance the development of the Italian high-speed railway and will be drawn down in three tranches. Future issuance is expected between June and October 2001.

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