CAF makes its largest-ever bond issue for USD 1.5 billion
January 19, 2023
Investor confidence in the financial soundness and impact of CAF’s interventions, as the green bank and the bank of economic recovery in Latin America and the Caribbean, in addition to the recent rating upgrade to AA- by Fitch Ratings, led to record-high demand at favorable rates and conditions.
CAF—development bank of Latin America—concluded its first debt issue in 2023 in the U.S. market, which became its largest-ever placement, through a benchmark-sized bond for USD 1.5 billion, with a January 2026 yield and a 4.75% coupon. This issue reached the highest demand in CAF’s history, with approximately 90 investors registered in the order book for an amount close to USD 2.4 billion.
CAF capitalized on the interest of investors thanks to recent rating upgrade by Fitch Rating from A+ to AA-, and issued this new bond increasing the diversification of the investor base, including fund managers, central banks, institutional investors, among others, from Europe, the United States, the Middle East and Asia. Placement banks included Bank of America, Citigroup, Deutsche Bank and Goldman Sachs.
“What better way to start 2023 than with the highest placement and the largest demand in CAF’s history. All aspects aligned perfectly for this operation, with our recent upgrade by Fitch Ratings last week (from A+ to AA-) and the positive market tone we have been witnessing at the beginning of the year. This solid performance shows the confidence of our investors as they have seen CAF’s recent progress, including new members and a historic capital increase,” said Gabriel Felpeto, Vice President of Finance at CAF.
Currently, CAF boasts the best credit rating in its history by rating agencies Fitch, S& P Global, Moody's and JCR. In 2022, the long-term funds raised amounted to almost USD 4 billion in 30 bond issues in 9 different currencies, with a greater presence in the U.S. and European markets.
CAF has been engaged in a diversification strategy for its financing sources for over three decades, through an uninterrupted presence in global capital markets, which has given it a privileged position internationally. CAF promotes sustainable development and regional integration through efficient funds mobilization for the timely provision of high-value-added multiple financial services to clients in the public and private sectors of shareholder countries..