SAO PAULO Itaú Unibanco SA borrowed a combined $480 million from a U.S. government-run lender and Wells Fargo & Co, as Latin America's largest bank by market value is increasingly using loan markets to finance clients in Brazil, its home turf.
Itaú obtained $400 million in a six-year term loan from Washington, D.C.-based Overseas Private Investment Corp, in the largest deal that the development agency, known as OPIC, ever carried out in Latin America. Wells Fargo, which also helped arrange the loan for OPIC, extended the remaining $80 million loan.
The proceeds will be used to fund a group of Itaú Unibanco's clients, chiefly small- and mid-sized firms, located in Brazil's northern and northeastern regions, said Carolina de Arruda Camargo, the head of international financial institutions at Itaú BBA, the corporate and investment-banking arm of Itaú.
"The highlight of this transaction is the volume, which was very significant for OPIC in Latin America, while for us it's great to see that export credit and development agencies are very interested in Latin America," Camargo said in an interview late on Monday.
Itaú will pay an interest rate pegged to the Libor, as the London Interbank Offered Rate is commonly known, plus a spread, Camargo added. She declined to elaborate on the spread and other terms of the deal.
Entrepreneurship in Brazil's once-depressed north and northeast corners is booming after years of fast expansion in household income and investment for sectors from infrastructure to paper and pulp and energy.
For years Itaú has strengthened ties with multilateral lenders and export credit agencies for lending deals that are often offer better conditions than market-based deals. Some of those institutions include the U.S. Export-Import Bank, the European Investment Bank and the World Bank's International Finance Corporation.
(Reporting by Guillermo Parra-Bernal; Editing by Bernard Orr)