Japanese agency JCR raises CAF’s credit rating to AA+

The credit rating agency Japan Credit Rating (JCR) raised the credit rating of CAF Development Bank of Latin America from AA to AA+ with a stable outlook, the highest rating ever for a Latin American issuer. This rating action will allow CAF to consolidate the institution’s financial trajectory and management and provide better conditions for all its shareholders, contributing to the development and integration of its member countries.

According to JCR, CAF’s credit rating is supported by the strong backing its member countries provide, demonstrated last March during the Extraordinary Shareholders’ Meeting when a capital increase of USD 7 billion was unanimously ratified, the highest capitalization in the history of the multilateral organization. The report also highlights the approval of CAF’s authorized capital increase from USD 10 billion to USD 25 billion.

CAF’s executive president, Sergio Díaz-Granados, said that this rating improvement is a significant endorsement of the institution’s financial management, enabling it to continue providing concrete responses to promote the development and success of projects that impact the people of all the countries where we operate. This new rating will allow CAF to wield more forceful responses in view of its commitment to become the green bank for economic recovery. These include supporting central governments, private companies and civil society with the aim of reducing social gaps, creating quality jobs, generating economic development, increasing access to technology and, above all, improving social cohesion.   

The Japanese agency’s report also highlights CAF’s provision of emergency credit lines totaling USD 4.1 billion to address the impact of the COVID-19 pandemic, as well as its rapid support to member countries by establishing a financial credit line totaling USD 1.6 billion for national development banks and two liquidity lines totaling USD 2.2 billion for health systems and services.

The JCR report also highly valued the incorporation of countries such as Costa Rica, El Salvador, Honduras and the Dominican Republic, which signed up to become full members of CAF, making the multilateral institution one of the largest financiers of development.