CAF achieves greater financial soundness in one year

 "Latin America and the Caribbean have a stronger CAF thanks to the commitment of its leaders to support them financially and technically at a time when they need it most to face social, economic and environmental challenges without leaving anyone behind," says Sergio Díaz-Granados, referring to his assessment of his first year in office as Executive President of the multilateral organisation.

The approval of the USD 7 billion capital increase, which will double the portfolio by 2030 and promote the objective of being the green bank and the economic reactivation of Latin America and the Caribbean, by the 19 countries and 13 private banks that make up the institution, was the first vote of confidence he received from the Board of Directors and the Shareholders' Meeting.

The second was to bring in new countries and increase the shareholding of others. Chile, Costa Rica, El Salvador, Honduras and the Dominican Republic became full members of the multilateral organisation, reaffirming CAF's commitment to work in favour of the region's integration to contribute to improving the quality of life of Latin Americans and Caribbean people, as well as to sustainable development.

This is some of the good news for Latin America and the Caribbean that led the rating agency S&P Global Rating to increase CAF's rating to AA- from A+. In its report the firm noted: "The positive outlook reflects our view that CAF's policy role and importance and its capital position can be strengthened by significant capital support from its members, which could significantly offset rating vulnerabilities in the region".

In line with the goal of becoming the region's green bank, CAF has taken several actions to realise this goal, allocating USD 25 billion to green finance by 2026, which implies an increase from 24% to 40% of total approvals. Likewise, in relation to initiatives linked to ocean conservation, USD 1.25 billion will be allocated over the next five years to finance projects that contribute to preserving, energising and promoting marine and coastal ecosystems in Latin America and the Caribbean. Projects related to the protection of the Pacific Ocean in Colombia, Costa Rica, Panama and Ecuador are also highlighted.

The economic and social reactivation of Latin America and the Caribbean is a priority for CAF. After allocating more than USD 16 billion to support the authorities to face the Covid-19 pandemic in Latin America and the Caribbean, in the last 12 months CAF has approved more than USD 12 billion to boost the well-being of the population, growth, employment generation and competitiveness in areas such as water and sanitation, roads, social development, energy transition, digital transformation, climate action and food security, among others.

Raising the voice of Latin America and the Caribbean on the global stage and fostering regional integration through active dialogue with each of the leaders of the 21 countries that currently make up the institution has been one of the hallmarks of the first year of management by Sergio Díaz-Granados and Christian Asinelli, Corporate Vice President of Strategic Programming. In the last 12 months, more than 30 agreements have been signed with strategic entities in order to add resources in technical assistance, financing and knowledge generation in favour of the most vulnerable.

"In this first year we have achieved the unanimous support of the shareholders with the capitalisation to be the regional space for integration and reactivation. What comes from here on is to travel throughout the region to double the portfolio in the renewed agenda we have set for ourselves to be the green bank of Latin America and the Caribbean, of economic and social reactivation, the strategic ally of the private sector and subnational governments to improve the quality of life of the people, close the gaps and make the leap towards development," added Díaz-Granados.

CAF will continue to work towards doubling the bank's operational size by 2026 in order to increase the growth in financing to support Latin Americans in an increasingly challenging global context at a rate of 7% to 8% per year.