Orix Trade Capital has completed the successful syndication of a US$35mn secured revolving export finance facility for Banco Santos, Brazil. The proceeds will be used by Banco Santos to make advances to certain corporate clients to finance their exports pursuant to the Brazilian government programmes.
The facility involves an innovative structure whereby the lenders benefit from the significant credit and sovereign risk mitigation inherent in Brazil’s official programmes, allowing for the facility to be linked to proceeds of export flows.
The facility, which was 40% oversubscribed and increased from its original launch amount of US$25mn is divided into two tranches of six and 12 months, with a renewal option.
The structure attracted a diverse group of lenders, a number of which are new to the Banco Santos relationship. Orix Trade Capital acted as bookrunner and lead arranger for the facility and was joined by Wachovia Bank and RZB Finance as arrangers. BayernLB was lead manager with Natexis Banques Populaires and Banco Latinoamericano de Exportaciones (Bladex) as managers. The Export-Import Bank of the Republic of China and Banco Comercial Português were participants.
Commenting on the success of the facility, Sebastião Cunha, international director of Banco Santos says, “The structure of the facility has allowed us to generate new additive sources of funding for one of our most important lines of business – our local exporter client base. The renewable feature of the facility and the two tranche structure also gives us the flexibility to be responsive to the needs of these clients on an ongoing basis.”
Hernán Narea, senior vice-president of Orix Trade Capital, adds, “The facility oversubscription evidences the market’s strong appetite for Banco Santos and this structured finance.”
Banco Santos is the sixth-largest Brazilian privately-owned bank.