Crédito Real eliminates credit-backed bonds from its liabilities

Mexico City – Real Credita Mexican lender in the process of liquidation, made the amortization of all of its trust stock certificatess eliminating debts backed by credit portfolios from its liabilities, reported the liquidator in a report published on the Mexican Stock Exchange.

The non-bank financial completed the payment of the certificate identified as CREALCB 17 in September and in December it reported that it had early amortized all of the trust stock certificates identified with the ticker symbol CRELCB 19.

The report does not indicate the liquidated amounts of the two instruments.

Through the bond code CREALCB 17, Crédito Real obtained resources of MXN$800 million. While CREALCB 19 considered an amount of MXN$750 million.

The two instruments were insulated from the company’s overall risk. The trust stock certificates were backed by payroll loans granted by Crédito Real that are deducted from pensioners and retirees of the Mexican Institute of Social Security (IMSS) and the resources were transferred directly to a master collection trust.

Until August 2022, Crédito Real estimated to have debts of approximately US$2.5 billion, of which US$615 million correspond to loans with financial institutions and the rest to unsecured notes.

Since then, the non-bank financial company has established a series of agreements, mainly with financial institutions such as Grupo Financiero Banorte, BBVA México, Santander, Scotiabank, Nacional Financiera and Blue Orchard.

This same week it was announced that Crédito Real advanced with the payment to the Japanese bank Sumitomo Mitsui Banking Corporation (SMBC) without giving more details. The credit line with the bank of Asian origin was acquired in 2016 and later extended to MXN$800 million, according to a report from the lender.

The company also made a partial payment to Nacional Financiera, a Development Bank institution. “Negotiations continue with the other creditors of the company,” said Crédito Real.

In the document, where the liquidator Fernando Alonso Rivero informs of a series of activities that are taking place, it is explained that Crédito Real is still awaiting the resolution of the Chapter 11 application in the US Bankruptcy Court promoted by a group of bondholders.

The Delaware Court has a hearing scheduled for January 31.according to court documents.

In addition, it also awaits the recognition of the US authorities of the dissolution and liquidation process undertaken in Mexican Courts.

Rivero also announced that the visit of the Mexican regulator, the National Banking and Securities Commission, is still ongoing, as well as the monitoring of Crédito Real’s tax obligations and audits in Mexico.