A wave of European and Latin American banks is hitting the U.S. capital markets.

The banks, which include big names such as Midland Bank PLC and Societe Generale as well as smaller institutions, have recently issued, or plan to issue, preferred shares or American depositary receipts.

U.S. banks have largely stayed out of the preferred market this year, leaving the field open to foreign banks, which have capitalized on investor interest in yield to raise equity.

Portuguese at the Fore

The tip of the wave is Portugal's Banco Espirito Santo e Commercial de Lisboa, which is marketing 4 million noncumulative preferred shares. The shares could be priced as early as today.

On Monday, Spain's Central Hispano Capital Ltd., a unit of Banco Central Hispanoamericano SA, filed a shelf registration with the Securities and Exchange Commission for up to $500 million or 20 million of noncumulative guaranteed preference shares.

Net proceeds will be loaned to the parent company and will be used for general corporate purposes. No underwriters were listed in the filing.

Accepting Latin America

Latin American banks have been an unexpected addition to the wave of foreign banks tapping the U.S. markets. Two privately owned Latin American banks plan to issue depositary receipts here, Mexico's Groupo Financiero Serfin and Argentina's Banco Frances del Rio de La Plata SA.

The acceptance of Latin American banks by U.S. investors is a sign of how far the Latin American debt crisis has faded from memory.

Major Latin American debtor countries have restructured their bank loans and have been attracting lenders and bond investors.

Now, Latin American banks are convincing U.S. investors to buy their equity as well.

Mexican Registration

Groupo Financiero Serfin, holding company for Mexico's Banco Serfin, last week filed a registration statement with the Securities and Exchange Commission for a global offering of 6.5 million American Depositary Shares.

Serfin said it is planning to offer one American depositary share for four of its own shares.

The per-share price for the receipts has not been set. The issue will be underwriteen by CS First Boston, Morgan Stanley, and Serfin Securities, an investment banking unit of the group,

Other Issues

The Mexican bank also is planning to issue 9 million so-called "L" shares. which can be purchased in Mexico by foreign investors but carry limited voting rights. The issue will be underwritten by a Mexican investment banking syndicate and will be sold in Mexico.

Argentina's Banco Frances del Rio de La Plata earlier this month registered with the SEC to issue up to 7.5 million American depositary shares.

Banco Frances is offering one depositary receipt share for three of its ordinary shares, which are traded on the Buenos Aires Stock Exchange.

Merrill Lynch & Co and J.P. Morgan Securities Inc. are underwriting the Banco Frances issue.

Banco Frances is one of the largest private banks in Argentina. As of June 30, the bank ranked sixth in Argentina in terms of deposits, with $860 million, and fourth in assets, with $1.6 billion.

Ease of Trading

Depositary receipts are issued either against existing shares or to raise fresh equity. They are denominated in dollars but their value is subject to fluctuations of other currencies against the dollar.

"As the international securities markets become more interdependent, securities issuers increasingly find themselves utilizing depositary receipts to provide ease of settlement and clearance for their securities in markets outside their home country," said Peter Tisne, a lawyer with Emmet, Marvin & Martin in New York.

"ADRs make it easier for investors to trade the securities of non-U.S. issuers in the U.S. securities markets." he added.

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