Banca Nazionale del Lavoro's (BNL) Argentine subsidiary is structuring a $350 million multi-asset program through which it plans to securitize its housing loans, credit card receivables and personal loan portfolio.
The bank is among Argentina's 10 largest financial institutions. It has a market share of approximately 3% and a wide network of subsidiaries throughout the country.
BNL specializes in housing loans and in financing for small- and medium-sized companies. The first deal from the multi-asset program will be an MBS offering, which will be divided into two $35 million-tranches, one in Argentine pesos and the other one in dollars.
Duff & Phelps Credit Rating Co. and Standard & Poor's will rate the transaction. "We approached securitization as a way to add liquidity," explained Pablo Cousido, BNL's financial director. "We started working on this program early last year and hope to see our first transaction in the second quarter of 2000."
BNL got its first taste of the ABS market back in 1999 with Secures, a securitization program for textbook publisher Angel Estrada S.A. Through the program, Estrada issued two transactions, one for $10 million in 1999 and another one for $12 million last month.
Now, with almost $750 million worth of mortgages, credit card receivables and personal loans, BNL decided to securitize its own assets.
"We had some challenges along the way," said Cousido. "We didn't have securitization in mind until recently and so we needed to do certain adjustments in the way we handle our books in order to comply with the requirements necessary to structure ABS deals."
The opportunity to buy BNL's deals was welcomed. "Having another player come in is good news," said one investor. "I've heard suggestions that other banks such as HSBC and Banco Rio will follow suit."