Argentina's Cooperativa de Tabacaleros de Jujuy (CTJ) is now known for something other than churning out smokes, at least among investors. The tobacco processor priced a US$12.4 million, one-year bond at 6.75%. Fitch Ratings gave the export receivable transaction an A-(arg)' on the national scale. Joint leads Cohen Bursatil and Nacion Bursatil focused on retail investors, who ended up with a significant chunk of the deal, according to a source on the transaction (for structure details see ASR 2/23, p.1).

The structurer of the deal, Banco Nacion, is working on other transactions designed to prop up regional economies, which is a mandate of the state-owned bank. The bank is understood to be crafting a deal for Vargas, a producer of dried fruit based in the city of San Rafael on the eastern flank of the Andes. The deal would be a small US$2.6 million and would likely benefit shipments of processed pears and cherries.

Banex sticks with institutional investors

Meanwhile, Argentine bank Banex issued the second tranche off a program backed by personal loans to pensioners and employees of the provincial government of San Luis. Sized at Ps21 million (US$7.4 million), a senior piece priced to yield 4.7%. Moody's Investors Service rated that transaction' on the national scale.

Pension funds gobbled up 75% of the deal, with only a tenth going to banks. "We privileged institutional investors over banks," said Fernando Pesci, director of Infupa, a boutique investment bank that structured the program. With rates depressed and investments few and far between, banks are bidding aggressively on bond issues, but brokerages are wary of doling out too much to a fickle audience. "We wanted to leave a good deal with our clients...who are long-term [institutional] investors," Pesci added.

Local dealer Capital Markets and the brokerage units of Societe Generale and Banex placed the transaction. The expected life of the senior piece is 10 months. B and C tranches add up to Ps9 million (US$3.2 million). A portfolio numbering over 44,000 loans, valued at a total Ps30 million (US$10.5 million), backs the A and B pieces of the deal, according to a Moody's report. A reserve requirement of 14% and a steep excess spread support the creditworthiness of the senior tranches.

Banex is the country's largest private bank specializing in nontraditional sectors such as retirees and government workers. It has a contract to act as financial agent to the province of San Luis until 2011.

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