Raising money for Latin American banks in 2002 required a
good dose of skill and imagination. International banks, stuck
with heavy losses in Argentina and fearful of more trouble in
Brazil, spent most of the year selling down assets in the
region and retreating to safer shores. Local banks had to find
new ways to fund themselves.
Last April, Banco Bradesco, Brazil's largest private-sector
bank, placed ¥17.5 billion ($145 million) in 10-year
subordinated debt backed by a political risk insurance policy
in a deal arranged by Merrill Lynch with one investor.
LatinFinance chose this transaction as insured bond of the year
for achieving the most cost-efficient issuance of subordinated
debt and longest-dated issuance in yen for a Latin American
bank in 2002.
Merrill Lynch Reinsurance Ltd. wrote the political risk
insurance policy covering 24 months of interest payments in the
event that Bradesco cannot...
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