WASHINGTON, D.C., Dec. 23—IFC has structured
and arranged a US$300 million collateralized loan facility for Banco Nacional
de Mexico (Banamex) Loan Trust, a special purpose Mexican trust established
to acquire and hold pools of long-term loans originated by Mexico's largest
bank, Banamex, to middle market companies in Mexico.
This transaction is IFC's largest ever financial sector operation and has
several innovative features. It is the first time that the Corporation
has made a loan to a special purpose trust to purchase loan assets from
a commercial bank. The facility has enabled the trust to match-fund its
portfolio of ten and five year loans through a creative borrowing structure,
which has enabled a larger fund mobilization at reduced costs. Further,
by showing that bank loans can be successfully transferred to a Mexican
trust on a commercial basis, the facility will help achieve securitization
of corporate and other loans in Mexican bank portfolios.
IFC's financing package consists of a US$100 million loan for IFC's own
account and a US$200 million loan for the account of participants.
The first tranche of the facility of approximately US$139 million
was disbursed on November 26, 1997 and was used by the trust to acquire
a pool of 21 ten and five year loans, which represent companies in a wide
range of sectors such as auto-parts, agribusiness, construction materials,
tourism, textiles, pharmaceuticals and paper. IFC worked closely
with Banamex to ensure that all loans met eligibility criteria established
by IFC. Banamex has provided a letter of credit and a liquidity
facility to support the trust's obligations.
"We are delighted to arrange, in close co-operation and partnership
with Banamex, this innovative long-term financing package for Mexican middle
market companies," said Mr. Jemal-ud-din Kassum, IFC's Vice-President
for Investment Operations. "This transaction builds on IFC's
strong tradition of developing innovative mechanisms to meet client needs
and we hope to replicate this and similar financing structures elsewhere."
IFC, a member of the World Bank Group, is the largest multilateral
source of equity and loan financing for private sector projects in developing