Banorte places perps

Banorte places perps

Bonds Debt Capital Markets Fixed Income Mexico Europe

Mexico's Banorte raised $1.1bn from a two-part perpetual bond deal, helped by expectations that the US Federal Reserve will cut interest rates this year, LatinFinance has heard.

"It was six times oversubscribed," Banorte's investor relations director, José Luis Muñoz, said of the bond sale.

Banorte split the deal into $500m in notes callable after five years and $600m callable after 10 years.

The bookrunners Bank of America, Goldman Sachs, Morgan Stanley and MUFG placed the $500m with a coupon of 6.75% and the $600m at 7.5%, said a banker not on the deal.

The bank, which posted a 47% jump in net income in the first quarter this year, had planned to sell as much as $1.5bn in perpetual notes, targeting investors in the United States, Europe, Asia and Latin America, especially Chile, Muñoz said.

"We originally sought $1.5bn, but we realized we did not need that much," he said, without giving more details on the buyers.

Banorte could use the money to pay off debt and add to its cash position, according to S&P Global. S&P gave the bonds a BB rating, four notches below Banorte's BBB+.

Banorte sold CHF250m ($257m) in 3.5-year bonds in Swiss francs in March. Before that, it got CHF100m in May last year.

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