CIFI, Latinex, and CAF Close the First Panamanian Corporate Debt Issuance in Euroclear Bank

June 21, 2024

The Latin American Stock Exchange, S.A. (Latinex), announced the first issuance placed in Euroclear Bank through phase II of the iLink connection, of a Panamanian corporate debt by the Inter-American Corporation for Infrastructure Financing (CIFI), which was fully acquired by CAF - Development Bank of Latin America and the Caribbean.

The Phase II of the iLink connection with Euroclear Bank, completed in February 2024, allows Panamanian corporate debt issuances and those from multilateral and/or supranational organizations listed on Latinex that meet rigorous requirements to be Euroclearable and accessible to international investors. Since 2014, through Phase I, Panama has had this connection between the Panamanian government and quasi-government issuances.
 
The CIFI issuance, consisting of a series of green bonds, marks a significant milestone in the internationalization of the country's private securities issuers. CIFI is the first Panamanian corporate issuer to place bonds through Phase II of iLink, with a total amount of USD 10 million. This achievement has become a reality thanks to the trust of CAF, its strategic partner since 2007. Together, they have collaborated to issue this new series of green bonds, thus supporting the development of the capital market in Panama.
 
César Cañedo-Argüelles, CEO of CIFI, emphasized, "This issuance represents an important step forward not only for CIFI but for the entire financial market in the region. Being the first issuer to use Phase II of the iLink with Euroclear is a testament to our commitment to innovation and sustainability. We are proud to lead this advancement and excited about the opportunities this issuance will bring to our projects and investors."
 
The proceeds from this green bond issuance, acquired and financed by CAF through resources from the Climate Change Program II of the KfW Development Bank of Germany, will be used to finance renewable energy projects that contribute to climate change mitigation and promote clean energy generation in Latin America and the Caribbean.
 
CAF Executive President Sergio Díaz-Granados stated: "We are very pleased to materialize a historic operation for sustainable development. Firstly, because it is aimed at financing renewable energy projects in line with our goal of being the green bank of the region; moreover, it becomes CAF's first purchase of thematic bonds; and in turn, supports the deepening of the Panamanian capital market through the internationalization of this issuance."
 
Olga Cantillo, CEO of Latinex, highlighted that "the placement of CIFI's green bond through the international iLink connection with Euroclear is an achievement that we are immensely proud of. This crucial milestone facilitates the access of issuers listed on Latinex to international investors, reinforcing our commitment to the development of the Panamanian capital market. Furthermore, it supports our mission to mobilize resources towards projects that promote the Sustainable Development Goals. We congratulate CIFI for trusting Latinex to implement their environmental impact strategy with the first green bond issuance in 2019 and for expanding it beyond our borders into international markets from Panama."
 
MMG Bank, as the structure of this issuance, and Morgan & Morgan, as external advisors, played a key role. For Roger Kinkead, Vice President of Investment Banking at MMG Bank, "CIFI's issuance and its crossover with Euroclear mark a before and after for the regional securities market. At MMG Bank, we view this development as a key opportunity to mobilize capital towards productive destinations, thus promoting sustainable development in the region. This model not only increases the visibility of our issuances but also opens new opportunities for global investors, fostering a more liquid and diversified market."
 
Latinex, as a group, is committed to market diversification and liquidity, facilitating access to a broad base of international investors. This achievement reflects the shared vision of promoting economic development in the region and continuing to offer pioneering solutions that benefit both issuers and investors.
Benefits of iLink Phase II:
 
- Convertibility of securities to Euroclearable:** Facilitates direct access to international investors.
- Diversification of the investor base:** Reduces dependence on a single group, lowering volatility risk.
- Increased liquidity and market growth:** Enhances the liquidity of issuances, promoting sustained growth of the regional securities market.
- Financial innovation: Allows for the issuance of new financial products and attractive issuance structures for global investors.
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