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Foreign Issuance into the local debt capital markets i.e. Mexico: An interesting alternative to other traditional markets.
By Francisco Romano Smith, Director, Actinver
Benefits
- Drivers: Arbitrage between issuing direct hard currency vs Local Currency and swapping into hard currency
- Size: Benchmark transactions are smaller in size US$100-300MM, issuers who need funding below US$500MM could find it interesting to explore local markets
- New Investor base: Issuers can tap local institutional investors that are restricted to invest cross-border and access to international markets could offer attractive funding
- Lower Issuance costs: Legal costs, underwriting and placement fees are lower in local markets.
- Reporting and Disclosure: Same reporting requirements as market of origin
- Local Investment Grade = AAA: Countries in LATAM and Caribbean region find BBB issuers very attractive they are rated AAA locally and find interesting demand.
It is worth exploring some local markets in the Region.
Francisco is Director of Investment Banking and responsible for Debt Capital Markets at Actinver Investment Bank. With a solid track record in the financial sector, he has been a key player in the structuring and placement of instruments in the Mexican stock market, as well as in the promotion of new financing opportunities for companies. His experience includes more than 25 years in the financial sector, leading initiatives in the areas of structured debt, capital markets and investor relations for companies such as Citi and Banamex, Banco Sabadell, SOMKAPITAL. Francisco studied Industrial Engineering at the Universidad Iberoamericana and has an MBA from Esade and NYU Stern School of Business.