Jamaica, Panama, the Dominican Republic, Ecuador and Brazil - if it wasn't obvious before, it is now - securitization is catching on. All five of these countries, rather rare issuers, are in the market with transactions that are expected to be privately placed.
National Commercial Bank (NCB), the largest bank of Jamaica, will launch a strong credit card receivables deal of at least $100 million next month. The deal will be led by Citibank, and XL Capital Assurance has won the mandate to wrap the one-tranche transaction. With XL's triple-A rating from S&P and Fitch, sources say the deal will pierce the sovereign ceiling with the same rating as XL. This deal will mark the second issuance from NCB, as it brought a much smaller credit card deal to market a few years ago.
Rumors are also flying around that Panama is jumping into the securitization ring with many deals in the pipeline. To name a couple, Banco del Ismo has banks grappling to get a piece of action from a $200 million credit-card receivables transaction. The deal is in the preliminary stages, and therefore the official players are still unknown. Separately, Panama's Banco General is known to be stepping into the market with a deal, also in the preliminary stages.
Additionally, The Dominican Republic's Banco de Credito is said to be in the market with a credit-card receivables transaction that may be led by First Union. Notably, sources say that First Union has a string of at least three deals in Latin America, though the bank was unavailable for comment.
According to sources, Ecuador is also in the pipeline: however, one source noted that as a result of the country's low sovereign rating, it will be quite difficult to carry out a deal unless it is wrapped by a third party.
Finally, after nearly five years in the market, the much-anticipated Banco Central do Brazil $250 million remittance transaction is scheduled to come to market next month (see ASR 3/12/01 p. 22). While one analyst noted that the deal has "a very aggressive schedule," another market participant said, "that's insane."
The array of new countries in this arena is a positive sign. "It reflects the maturity of the market," said one managing director of an insurance company. Another analyst commented, "These are not typical markets like Mexico, Peru and Argentina. It's positive for smaller markets and smaller transactions."