3. LatAm Debt Markets
2009 Predictions
• Commodity financing will recover first.
• 3-month LIBOR will drop to 85bps.
• Regional banks are well positioned to drive growth.
• Tighter restrictions on covenants may be coming:
– Cap Ex
– Dividends
– Reporting
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4. LatAm Debt Markets in 2009
• Commodity-based financing for major companies
in LatAm has continued to prosper.
• 3-month LIBOR reached 25 bps.
• LatAm regional banks withstood the crisis fairly well and
are expected to be the world’s fastest growing in 2010.
• Covenants have tightened:
– banks re-evaluate risk management, and
– return to more traditional credit metrics.
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5. LatAm Debt Markets Outlook
• Major corporations will likely continue to receive the
majority of funding and make strategic acquisitions.
• LatAm trade with Asia is expected to grow and bring
additional foreign investment.
• LIBOR is likely to increase by end of 2010.
• Decrease in political instability is a good trend, but
regulatory backlash from the financial crisis may
negatively affect growth.
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6. LatAm Equity Markets in 2009
• By December of 2009, the MSCI EM Latin America Index
recovered to nearly the same level calculated at the beginning
of 2008.
• In 2009, LatAm issuers completed more than US$20.5 billion
in issuances, closing the year with Santander Brazil’s record
IPO (R$12.3 billion).
• Trade volume and value of LatAm ADRs decreased in 2009 in
line with global trends, however BNY Mellon’s LatAm ADR
Index outperformed all other regions worldwide with a 95%
increase by year end.
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7. Sample of Equity Transactions
Completed in 2009
• Sale by BAC Credomatic Holding of a 25.1% stake
in BAC Credomatic to GE Capital Global Banking.
– BAC Credomatic has retail banking operations in Costa Rica,
El Salvador, Guatemala, Honduras, Nicaragua, Panama,
Mexico, the Cayman Islands and Bahamas.
• Carlos Casado S.A.’s first over-the-counter
ADR program.
– Carlos Casado S.A. is an agribusiness company based
in Buenos Aires.
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8. LatAm Equity Markets Outlook
• More deals expected to follow IPO of Banco
Santander Brasil (Brazil’s largest IPO to date).
• LatAm regional banks’ growth in 2010 will attract
international investors.
• Increased action on private equity/M&A space.
– Over 192 deals worth US$72 billion have been announced
already this year.
• For many, LatAm offers indirect play into
China investment.
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