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Interbolsa Clients May Be Stuck With Fabricato, Cordoba Says

Feb. 21 (Bloomberg) -- About 600 clients of the seized Colombian financial firm Interbolsa SA who made loans secured by shares of textile-maker Fabricato SA may be stuck with the stock next week as investors default on their debts, according to the head of the country’s stock exchange.

The investors who borrowed the money against their Fabricato shares probably won’t pay back the loans or make margin calls when the stock opens March 1 for the first time in three months, exchange Chief Executive Officer Juan Pablo Cordoba said. Fabricato plunged 21 percent on Nov. 16, prompting the exchange to suspend trading.

“It’s very likely that 100 percent of the loans will be defaulted on March 1,” Cordoba told reporters today at a press conference at the Bogota-based exchange, Bolsa de Valores de Colombia SA. “Those who borrowed must pay it back, if not with the money they owe then with the Fabricato shares.”

Fabricato had been Colombia’s biggest publicly traded textile maker by market value prior to its share-price plunge. A report released by the Medellin-based company earlier this week stated that the value of the shares may be 55 pesos or less, a 24 percent discount to where they last changed hands in November.

Interbolsa, also based in Bogota, was seized by the Colombian government in January and is now being liquidated. Its brokerage firm, which was the country’s biggest, collapsed last year after a failed attempt to finance a control bid for Fabricato by a group of activist traders, according to Pablo Munoz, the Colombian official overseeing the liquidation.

To contact the reporter on this story: Christine Jenkins in Bogota at cjenkins28@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

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