Wachovia Securities was heard roadshowing its second Latin American ABS last week, a US$75 million transaction for Banco Salvadoreno. The deal is backed by diversified payment rights (DPR) and tenor is expected to come at between five and seven years. Salvadoreno had been initially working with Merrill Lynch on a DPR deal; when that commitment expired, Wachovia moved in. The structure is understood to be similar to what Merrill had conceived, with some tightening. "The new bankers wanted to put their stamp on it," said a source familiar with the transaction.

The debt-service coverage ratios will trigger early amortization if they slip below 5X for the month and 8X for the quarter. The trigger ratios were previously 3.5X and 6X, respectively, as spelled out in a Fitch Ratings report released in November 2002. Wachovia also upped the percentage of collections that must be maintained with correspondent banks for three collection periods in order to avert early amortization. That figure was punched up to 70% from 60% initially.

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