The Latin American loan market has ostensibly held up well against this summer's credit crunch, with very little seepage from its neighbours to the north. But credit committees at large European and US banks are starting to ramp up the pressure and bankers are warning of tighter terms on the horizon. In a market that is intensely relationship driven, LatAm bankers are perhaps finding it more difficult than most to explain the unpleasant new realities to clients who have become accustomed to bene

IFR: What about retail banks' participation in the region. I understand some didn't renew during the recent Pemex amendment. Is retail pulling back from the region and if so how important is that? Rubio: Well maybe with the any new repricing, they will come back and be more active now. Gracia: Many of the retail banks walked away from the region probably last year, or slightly before that, when prices started to get extremely tight. The tendency of price tightening continued into probably the be

IFR: What other sectors are particularly sensitive to the economic cycle and might undergo a rebalancing in their pricing equilibrium? Rubio: I think construction, down the road, maybe. We’ll see. IFR: What have been the benchmark transactions so far this year and which ones will be a gauge for sentiment in the second half? Rubio: Well, I guess you have the Farac [the US$3.7bn peso-denominated syndicated loan via Santander that will be used to fund construction company ICA and Goldman Sach's US$

IFR: What is the outlook for the rest of the year? What impact is the current credit crunch likely to have on the Latin American loan market? Alonso Molina (BBVA): I think so far it is difficult to determine exactly what is going to be the impact in the medium and long-term in Latin America. But I would like to underline two points. The first one is that investors are increasingly starting to differentiate among asset classes. And Latin America has not been hit or at least the market has not bee

Rodrigo Gracia - Calyon Gracia has been director in Latin American loan syndications group at Calyon since October 2004. Prior to that, he was a vice-president in the Latin America debt capital markets group of Dresdner Kleinwort Wasserstein, which he joined in 2002. Gracia also worked as an associate at JPMorgan Chase’s global syndicated finance division, where he was involved in structuring and executing syndicated loan transactions in the US and Latin America. Katia Bouazza - HSBC Bouazza is