Brazil LTN

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Repatuated LTN

Our capabilities enable possibilities to become reality.

OVO works with its clients to create and complete an exchange listed, Delivery vs. Payment "Euroclear DVP procedure" T2S eligible transaction. Only Electronic Certificate of Financial Instrument, "STN Black Screen" registrations , with electornic custody at STN are eligble.

Why only Black Screens? The Central Bank of Brasil website states: "Current law prohibits BCB to issue government bonds. Furthermore, all bonds issued by the Brazilian National Treasury (Tesouro Nacional) are traded and held electronically and do not exist on paper. Thus, documents presented in paper format are fruadulent and do not represent debts of the BCB nor debts of the Brazilian government". Moreover, B3 states: "securities in Brazil have been fully dematerialized since the nineties. Custody positions are registered in book-entry format". Thus Electronic Certificate of Financial Instrument's held in electronic custody via STN mitigages any potential fraud of paper based LTN's.

The Electronic Certificate of Financial Instrument, can with special treatment be used as collateral for new fungible Asset Backed issuances from where high value exits via Euroclear DVP procedure T2S can take place. What's required?

  • Titleholder CIS.
  • Copies of Black Screens.
  • Copies of all Certificates and Authorizations.
  • Attestations and Ownership.

We will then execute due diligence and follow up with any questions and if required, ask for additional supportive documentation. Upon successful due diligence, we will then issue a contract for the exchange listing and Sale of the instrument(s).

About LTN

Strategic solutions to complex issues.

In the early 1970's Brazil Central Bank needed to create new fixed rate instruments which were more suitable for monetary policy. Laws no 1,079 and CMN Resolution no 150 of 1970 were passed thus establishing Letra Tesouro Nacional ("LTN") National Treasury Bills for Monetary Policy.

  • In 1970 LTNS were 5% of the total debt.
  • By 1972 LTNS were 33.6% of the total debt.
  • Short term Notes to fund Government, control inflation and monetary policy.

The current issue LTN and LFT fixed and floating-rate bills are the most liquid securities in Brazil. LTNs of the 70's and through today are successful legal Federal Debt Instruments. As evidenced by Brazilian laws issued in 1995, 2000 and 2001, LTNs which stem from the 1970's are legitimized and held to be valid instruments. Moreover, in an issued 2009 law LTNs were awarded use as legal forms of payment for Brazil Federal Taxes. However, they must undergo "GRU" taxation, and be revalued by the Tesouro Nacional. While today historic LTNs are not fungible, they can with special treatment be used as collateral for new Asset Backed issuances where the new isuance can be exited for value.

European Exchange Listing

Strategic solutions to complex issues.

We are delighted that a strong IP underpinning spanning, in this case, Brazilian and EU law deeply merged with proprietary techniques have developed into a robust IP engine for the securitization of certain asset classes and is the key to listing the Brazilian Electronic Financial Certificate assets. The IP stack underpins the securitization and enables the zero-coupon Brazilian assets to be listed and exited where without it, it would be virtually impossible to list and exit this class of asset. In more broad terms the IP and infrastructure combined could be more accurately described as a class specific Securitization Platform where it enables increased institutional transparency and transactional velocity while further allowing investors a simpler purchase experience and assured redemptions.

For clients who wish to enable their Electronic Certificate of Financial Instrument for a high value Euroclear DvP eligible transaction, below is a summary of the proceedings.

We execute exchange listings in the same manner as most all debt issuances are listed.

  • Structured Asset Backed Securitization.
  • Dematerialization and ISIN.
  • Buyer places funds.
  • Exchange Listing.
  • Titleholder changes title of Electronic Financial Certificate asset.
  • Euroclear DVP proceedure T2S closing.

Want to learn more about solutions? Contact us today, and we'll connect you with a principal member of the firm who can help you with your needs.


  • Transforming Illiquid Assets

    OVO specializes in Transforming illiquid assets into viable structured liquid assets via credit-linked asset backed solutions from where they can then be exited via the European public exchanges.

  • Brazilian Assets

    We have a deep understanding of vehicle structures and the market. We custom structure Brazil LTNs into credit-linked asset backed instruments where such can be exited via the European public exchanges.

To learn more about Brazil and the history of LTNs, click the button below.

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