Successful placement of 300 million euros

(Caracas, November 7, 2006).- The Andean Development Corporation (CAF) today placed 300 million euros at five years at a floating rate on the European market. The operation - originally planned for 200 million euros - was increased to 300 million euros due to extraordinary demand of over 1.70 billion euros. This successful issue was heavily subscribed by over 60 European investors, mainly from Great Britain, Germany, France, Austria, Spain, and Holland, among others. The lead banks were Calyon and HSBC. CAF President & CEO Enrique García said, “the financial strength of the Corporation is again confirmed by the success of this new issue. With this operation we maintain our constant presence on the most important international financial markets."

The purpose of this bond, issued on the European market, is to finance the institution’s loan operations, which are mainly destined to infrastructure and integration projects that stimulate the development of member countries, in line with the mission of the multilateral financial organization, García said. The Corporation's financial strategy is based on diversification and expansion of the sources of funds and reduction of costs on international financial markets. CAF is recognized as the most competitive Latin American issuer with respect to the rates and terms obtained on its placements.

This year the Corporation placed a ten-year US$250-million issue on the US market, and has also carried out operations in local currency in Venezuela with a bond issue for 215 billion bolivars at five years, and in Peru a placement of 248 million new soles in bonds. CAF has four ratings granting by the most prestigious risk agencies: Moody's (A1), Standard & Poor's (A), Fitch (A+) and JCR (AA-). The agencies say the ratings are based on the sustained growth of the capitalization of the institution, continuing profitability, and efficient financial performance, as well as the immunities and privileges conferred by its international legal status.