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BEST STRUCTURED FINANCING/INNOVATION

Jan 1, 2011

The State of Mexico (Edomex) in August issued a much anticipated 4.1 billion peso 20-year local bond, the first securitization of future flows of income from residential property fees from a Mexican state.

The deal opens the door for other LatAm sub-sovereigns to work with new guarantors, as well as for other Mexican states to use the format.

"We have since received enquiries by issuers looking to replicate the deal," says a DCM banker at one of the leads. "But it will be a while before we see them issue bonds as the process takes a long time, and needs approval from various authorities," he adds. Joint leads were Banamex and HSBC.

"This transaction generates new options for investment for the local market, opens new sources of funding for infrastructure development, and strengthens the Mexican capital market," says Enrique García, president of CAF. The Andean multilateral provided its first...

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