In November 2010 announcements were made for works worth $760 million to be financed through securitizations which never materialized.
An article in Elfinancierocr.com reports that "In October 2010 a change in the regulation of public offering of securities came into force regulating investment instruments originating from securitization and trusts for public works developments."
In the absence of state resources for public infrastructure projects, securitization is an alternative for funding.
El Salvador is in a second phase of securitization, where the focus is on generating assets that can be securitized, and future market opportunities are investment opportunities from financial assets, said the expert Jose Miguel Valencia.
A law regulating the microfinance market would open the opportunity to capture savings that currently can only be done through cooperatives and banks.
The article by Byron Dardón in Capital.com.pa, reports that the bill on microfinance is expected this year and has the support of the Financial Inclusion Program of the Treasury of the United States, which promotes the adoption in Latin American countries of market governing rules.
The securitization project to redevelop the facilities of the French School is the first of its kind in the Salvadoran Stock Exchange.
Hencorp Securities carried out the process by issuing the securities, "some of the features of the placement are a 6% yield (with a 7% ceiling) and a repayment period of 10 years," says Laprensagrafica.com.
Rolando Duarte, president of the Stock Exchange of El Salvador, told the media that securitization is a vehicle for companies and organizations to finance their projects.
Costa Rica approved a system to finance the construction of public works via trusts and securitization.
Approved by supervisor Conassif, the mechanism comprises the creation of “Issuing Trusts”, which will issue securities in the local market. Said securities must be priced $50.000 or more, and may only be bought by sophisticated investors.
The money obtained by selling these securities will be used to finance the construction of public infrastructure projects.
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