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Fitch Ratings improves the long-term risk rating of CAF-development bank of Latin America


"We will continue to materialize the goal of being the green bank and of economic and social reactivation", celebrates the executive president, Sergio Díaz-Granados

Headquarters of the Development Bank of Latin America (CAF) in Caracas (Venezuela).CAF

The risk rating firm Fitch Ratings improved the long-term rating of CAF-development bank of Latin America to AA, from A+ and with a "Stable" outlook.

This action reaffirms the confidence of investors, which will allow it to offer financing under better conditions to its member countries.

CAF thus reaches the best credit rating level in its history with rating agencies Fitch, S&P Global, Moody's and JCR.

In its report, Fitch highlighted the commitment of the development bank's shareholders to strengthen the institution's assets with a capital increase for a total amount of 7,000 million dollars, the largest in its history.

He also pointed out that several countries have already signed this agreement and have begun to pay their respective contributions.

“The recently approved significant capital increase and favorable loan portfolio dynamics will support the continued improvement of CAF's solvency profile,” read a Fitch press release.

“Shareholders' capital contributions will support the bank's credit expansion and portfolio diversification in the coming years, while helping to maintain excellent capitalization ratios,” he continues.

CAF's executive president, Sergio Díaz-Granados, celebrated the decision, thanking the 20 countries that make up the bank: "We start the year with good news for all Latin American and Caribbean countries who will be able to access better financing conditions to promote the programs social and strategic projects that will improve their quality of life”.

And he added: "Thanks to the commitment of the countries to strengthen CAF and place their trust in us to continue materializing our goal of being the green bank and the economic and social reactivation of the region."

Fitch Ratings also highlighted CAF's strategy to increase the participation of shareholders such as Chile, Costa Rica and the Dominican Republic, which became full members, as well as the incorporation of new shareholders such as El Salvador and Honduras.

Three decades promoting sustainable development

The entity has been carrying out, for more than 30 years, a strategy of diversifying its financing sources, through an uninterrupted presence in the global capital markets.

The multilateral promotes sustainable development and regional integration, through an efficient mobilization of resources for the timely provision of multiple financial services, with high added value, to clients of the public and private sectors of the shareholder countries.

Source: elparis

All business articles on 2023-01-26

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