CAF places successful $250 million bond in Yankee market

(Caracas, September 6, 2006).- CAF placed a bond issue in the US market yesterday initially planned for $200 million but, due to demand of almost twice as much, was later increased to $250 million. The issue, maturing in 2017, had a very competitive rate and was priced at a similar level compared to CAF’s ’15 bonds.

CAF’s President and CEO, Enrique Garcia, stated that “this issue is the result of the Institution’s permanent presence in the most demanding international markets. In fact, the Corporation has placed more than $1.2 billion in the international bond markets between 2004 and 2005”. He also underscored the issue’s diverse geographical allocation: investors participated from the US, Europe, Asia and Latin America. The placement was lead by Credit Suisse and other dealers involved were Citigroup, HSBC, Merril Lynch and Morgan Stanley.

In addition, in June of this year, CAF placed a VEB 215 billion bond (equal to $100 million) in the Venezuelan market, making CAF the first multilateral bank to issue in that country since 1976. The Corporation also placed a PEN 248 million bond (approximately $75 million) in Peru, the largest ever for a non-governmental issuer, at the end of May.

The purpose of CAF’s bond issues in the international capital markets is to obtain resources to fund important projects in line with its mission of supporting integration and competitive economic development of its member countries’ public and private sectors.

Lastly, Garcia highlighted that the Corporation’s financial strategy is based on the diversification of its funding sources, as well as cost reduction, in the international capital markets, where it is currently recognized as being among the most competitive Latin-American issuers in terms of the rates and tenors attained in its issues (CAF has placed 51 bond issues to date).

CAF has been granted four credit rating from the most prestigious rating agencies: Moody’s Investor Service (A1), Standard & Poor’s (A), Fitch Ratings (A+) and Japan Credit Rating (AA-). These agencies have indicated that they asses CAF based on its consistent growth in capitalization, continuous profitability and financial soundness, as well as the privileges and immunities granted by member countries because of the Corporation’s legal international standing.