Washington, D.C., June 24, 2004—The
International Finance Corporation (IFC), the private sector arm of the
World Bank Group, today returned to the domestic Colombian bond market
to issue a new peso (COP) bond offering. The lead manager and arranger
of the transaction is Corporacion Financiera Nacional y Suramericana S.A.(Corfinsura),
co-arranger is BNP Paribas and Suramericana and Inversionistas de Colombia
participated as syndicate members.
The domestic bond offering is for an amount of 269 billion Colombian
Pesos (COP), approximately US$ 100 million equivalent, has a three-year
maturity, carries a 10.99% coupon and was priced 123 basis points through
domestic government debt (TES 2007). “The transaction was an
outstanding success. The bonds were priced via a Dutch auction, resulting
in a total orderbook consisting of 188 orders and in a transaction which
was more than twice oversubscribed” said John Groesbeek, Senior Financial
Officer at IFC.
In 2002, IFC successfully opened the domestic COP bond market (the “El
Dorado” market) for multilateral entities by issuing a COP 225 billion
5-year domestic bond. That transaction represented the first domestic
bond offering by a supranational in Latin America. Subsequently,
several other multilaterals issued bonds in the Colombian market, and IFC
followed with several domestic innovative structured finance transactions.
By launching this bond issue, IFC is showing its continued support to Colombia
and the further development of the domestic bond markets. Nina Shapiro,
IFC’s VP Finance and Treasurer, said: “IFC is delighted to have executed
this new transaction in Colombia. The establishment of the IFC credit
in the domestic market, provides a sound base for the issuance of structured
finance products for IFC’s clients. Since our first COP offering,
IFC has executed seven structured finance transactions in Colombia, including
the first securitization of non-performing loans in the whole of Latin
America, all of which further developed the domestic capital market.”
The proceeds of the issue were swapped into floating rate US dollar funds.
The end-benificiary of the swap is a Colombian entity, which was
able to hedge part of its foreign currency liabilities into fixed rate
local currency liabilities.
IFC funds its lending activities by issuing bonds in the international
capital markets. The Corporation’s securities, which are rated Aaa
by Moody’s and AAA by S&P, have been issued in 30 different currencies.
IFC’s funding program for fiscal year 2004 is around US$3.5 billion.
IFC has been the first, or among the first, nonresidents to issue
in many currencies including Spanish pesetas, Portuguese escudos, Greek
drachmae, Hong Kong dollars and Singapore dollars in the domestic markets,
and in Czech koruna, Polish zloty and Israeli shekel in the eurobond markets.
The mission of IFC (www.ifc.org)
is to promote sustainable private sector investment in developing countries,
helping to reduce poverty and improve people’s lives. IFC finances private
sector investments in the developing world, mobilizes capital in the international
financial markets, helps clients improve social and environmental sustainability,
and provides technical assistance and advice to governments and businesses.
From its founding in 1956 through FY03, IFC has committed more than $37
billion of its own funds and arranged $22 billion in syndications for 2,990
companies in 140 developing countries. IFC’s worldwide committed portfolio
as of FY03 was $16.8 billion for its own account and $6.6 billion held
for participants in loan syndications.