The Chamber of Deputies approved loans for RD$500 million (about US$30 million) for the purchase of five Bailey bridges from Mabey & Johnson of the United Kingdom. The local partner is Construcciones Transporte Pagan. Dana Cabral, Citibank resident vice president clarifies that the loan was structured through an export credit agency, the Export Credits Guarantee Department (ECGD) from the UK, and provides a comprehensive guarantee on 85% of the loan amount for the support of exports from that country. The guaranteed portion of the loan has a fixed interest rate of 6.84% for the life of the loan, or 12 years. The remaining uncovered portion of the loan, or 15% of the US$30 million, has been contracted at a spread of 4.5% over six month Libor for a lower 3 year tenor. On Friday, 14 September, the six month Libor stands at 3.14% for an indicative cost of 7.64% for the financed portion without the ECGD enhancement. If the loan were to be disbursed today, the weighted average interest rate would have been 6.96%, not 12% as mentioned in a brief on Thursday, 13 September.
