An innovative transaction, involving the issue of a $250 million medium-term note secured against dollar-denominated credit card payments, has been signed by Banque Misrwith West LB.
The transaction has a maturity of seven years, including three years' grace, and is understood to be priced at about 140 basis points over Libor. The deal is structured around the newly formed Banque Misr Card Receivables Master Trust Securitisation Programme. It will entail Banque Misr assigning dollar-denominated credit and debt card voucher payments due for Visa International Services Associationand MasterCard Internationalto Misr Card Finance,a Cayman Islands-registered special purpose vehicle (SPV). The SPV has issued a 2002-A note to the New York-based Banque Misr Card Receivables Master Trust, which in turn issued a 2002-A certificate to a Cayman Islands affiliate of West LB-sponsored Compass Group.
Interest and principal payments will be insured by US-based MBIA. The transaction has received ratings of AAA from Standard & Poor'sand Aaa from Moody's Investors Serviceand underlying ratings, without the insurance guarantee, of BBB and Baa2 respectively. West LB helped Banque Misr secure its own ratings from the two agencies - a prerequisite for the transaction to be rated.
This is the first time that a financing arranged for an Egyptian financial institution has been rated higher than the country's sovereign rating. It is also the longest term financing raised by an Egyptian bank on the international market.
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