Restructuring & Securitisation

Cuba re-packaged Loans

A client invited Exotix to set up a Cuba securitisation platform through a new proposed Special Purpose Vehicle called CDR Limited. As well as giving some advice on the structure of the SPV and the various tranches, Exotix took on the role of Servicer and Dealer.

CDR was created to take assignment of Cuban loans and to issue an equal nominal amount of euroclearable and listed pass-through notes. These notes benefit from a potentially wider ownership base than the underlying loans since more institutional buyers are able to buy euroclearable debt. These bonds trade at a premium to the equivalent loans.

The SPV was launched with press coverage in October 2005. Cuban debt amounting to Euro 148 million nominal was swapped into CDR notes in the initial seven tranches. In December 2005, Exotix as servicer agreed with three additional institutional clients the assignment of a further DEM 90 million and JPY 800 million into CDR enlarging the programme size to approximately Euro 200 million nominal.

Serbia re-packaged FCSBs

In 2003, Serbia issued Foreign Currency Sovereign Bonds (FCSB) to private depositors in compensation for foreign currency bank balances which the government requested in the early 1990s. Exotix arranged to securitise the FCSB and offer them to European Institutional Investors. The programme was very successful and contributed to a rapid contraction in local yields.