The high demand for bonds was driven mainly by central banks, fund managers, insurance companies and banks.
CAF, the development bank of Latin America and the Caribbean, issued a benchmark bond for US$ 1 billion with a 3-year term.
This issuance in US dollars has reached a historic milestone for the institution, exceeding US$ 10.7 billion in orders.
The high demand was driven mainly by central banks, fund managers, insurance companies and banks. Investors highlighted CAF's financial strength, its relevance in the region and its growth prospects.
The transaction was jointly structured by Bank of America Securities, BMO Capital Markets, Goldman Sachs International and Morgan Stanley & Co. International PLC.
The bond, listed on the London Stock Exchange, will pay a semi-annual coupon of 4.125% and offers a spread of 0.519% over the benchmark US Treasury bond.
“At CAF, we work to build a better future in Latin America and the Caribbean. This bond issue, which achieved historic demand and marks a new milestone for CAF in the markets, will allow us to offer resources at competitive rates to countries to make aqueducts, schools, hospitals and roads a reality that will improve the quality of life of the population; and in turn support entrepreneurs, farmers and small producers, among others, to boost their productivity,” said Sergio Díaz-Granados, CAF’s executive president.
For his part, Gabriel Felpeto, CAF's Vice President of Finance, commented: "We are proud to announce the issue with the highest demand in CAF's history. We achieved an order book 10 times greater than the amount issued, with 156 global investors.
This is a clear testimony to the market's confidence in our institution, our financial strength and our firm commitment as a strategic partner for the development of Latin America and the Caribbean."
In 2024, CAF's long-term fundraising is close to US$7 billion in more than 28 bond issues in 11 different currencies, with a greater presence in the US and European markets.
For more than three decades, CAF has been pursuing a strategy of diversifying its sources of financing through an uninterrupted presence in global capital markets, which has placed it in a privileged position internationally.
The multilateral institution promotes sustainable development and regional integration through efficient mobilization of resources for the timely provision of multiple, high value-added financial services to clients in the public and private sectors of shareholder countries.
