NEW YORK, Oct 23 (IFR) - Banco do Brasil is discussing the possibility of tapping the syndicated loan market in what is thought to be its first foray into this asset class in recent years, market sources said on Wednesday.
The quasi-sovereign bank is looking to raise up to US$1 billion through a two-part loan comprising three and four-year tranches, one of the sources said.
The move would help the borrower diversify its funding base at a time when loans are becoming more competitive, as banks compete for assets and try to grow market share.
Costs in the bond market have risen ahead of an eventual tapering of the Federal Reserve’s asset-buying program, which is now expected to start next year.
“Banco do Brasil is a frequent user of the bond market but the loan market is looking attractive,” said one banker.
“It is a big name, so I expect it would get a lot of traction in the loan market.”