DALLAS The North American Development Bank announced Tuesday that Conrad Keith Sterrett has joined the bank as its new chief financial officer.
Sterrett replaces former NADBank CFO Lloyd Tyler, who has taken a position as finance director for Vancouver, Wash.
Sterrett most recently served as finance director for the Virginia Housing Development Authority. During his tenure there, Sterrett was responsible for municipal debt financings worth over $12 billion.
Among those transactions were some of the earliest uses of such industry innovations as convertible option bonds, self-insured pool insurance bonds, and total-return swap transactions.
We are very excited about the opportunity have Conrad join us here at NADBank, said Juan Antonio Flores, public relations and governmental affairs officer for NADBank. A big part of what we want Conrad to help us with is creative bond finance as we take advantage of the emerging opportunities we see ahead.
The San Antonio-based bank, which was created in 1993 under the auspices of the North American Free Trade Agreement and began operations in 1995, assists municipalities on both sides of the United States-Mexico border with loans and grants for infrastructure projects, as well as assisting some with packaging their municipal bond issues. Both the U.S. and Mexican governments support NADBanks operations.
NADBank has also used its resources to purchase debt issued by small municipalities.
Really, at this point what weve done is commit to buy a certain amount of bonds issued by municipalities on the United States side of the border, Flores said. On the Mexico side, weve really been limited to traditional grants and loans. However, Mexico now has a fledgling municipal bond market, and a goal of NADBank is to nurture this market and help it grow into a tool that these local governments can use.
A handful of municipal issues have been sold in Mexico, but because Mexican law allows only Mexicans to purchase government obligations, only those entities with fiscal strength attract the interest of the handful of players that participate in the market on the buy-side.
However, NADBank has benefited recently from legislation approved by the congresses in both Mexico and the United States in 2004. The original legislation approving the banks creation allowed it to help Mexican or U.S. communities 100 kilometers from the border.
Now we have jurisdiction to assist communities 300 kilometers into Mexico, Flores said. This will enable us to reach the capital cities of most of the border states and those cities have the creditworthiness to take advantage of our services.
Legislation pending in the U.S. Congress would allow the bank to use its assets to guarantee municipal bond issues.
Sen. Kay Bailey Hutchison, R-Tex., wrote the measure, which would exempt NADBank from a provision of the federal tax code that prohibits federal guarantees of tax-exempt bonds, making it easier for smaller communities to sell debt and reduce their borrowing costs.
Instead, NADBank guarantees would be treated like those from the Federal Housing Administration, the Veterans Administration, and the Federal National Mortgage Association and other government-sponsored entities.
Prior to joining the Virginia HDA, Sterrett worked as an officer in the corporate finance department of Shearson, Hayden Stone Inc.
