- The Multilateral Bank transfers the efficiencies obtained in
its borrowing costs to benefit its borrowing countries.
- This action represents its first rate reduction since
2021.
TEGUCIGALPA, Honduras, May 16, 2024
/PRNewswire/ -- The Central American Bank for Economic Integration
(CABEI) announced today a downward adjustment between 0.50% and
0.65% in the interest rate applicable to current and new sovereign
public sector loans that have an adjustable spread rate scheme
(Term SOFR + spread).
According to CABEI's Executive President, Gisela Sánchez, the loans eligible for this
improvement are approximately 120 operations that include the
already disbursed portfolio, the loans approved pending
disbursement, and the approvals contemplated under the 2024 Annual
Operational Plan, which, in aggregate, exceed US$12 billion.
Mrs. Gisela Sánchez also added that this reduction in the
interest rates of CABEI loans to its borrowing countries is a
reflection of the continuous improvement in the bank's funding
costs, particularly in bond issuances deployed in the international
capital markets, where we are recognized as the best risk in all of
Latin America with a "AA"
rating. The objective is to transfer this benefit to the
region's countries, especially considering the current context
faced due to high interest rates resulting from efforts to contain
global inflationary pressures.
CABEI's funding strategy contemplates a transversal objective of
optimizing costs by diversifying maturities, markets, and
instruments, as reflected by the more than 170 bond issuances
executed by the Bank in 23 markets and 25 different currencies
worldwide. Thus, in markets such as Mexico, CABEI obtains lower costs, and in the
Asian and European markets it seeks longer tenors and/or
diversification of investors, while the benchmark/global market
accompanies the organic growth of its balance sheet.
Finally, President Sánchez reaffirmed her commitment to
technical rigorousness and operational efficiency as fundamental
elements that accompany this process to enhance CABEI's
competitiveness as the region's main provider of multilateral
resources.
A summary of downward variations in interest rates can be
observed in the following table:
Comparative
Table
Summary of
Variations in the Spread over 6-Month Term SOFR of
Sovereign
Interest Rates (%)
|
Term
|
April - June
2024
|
January - March
2024
|
Variation
|
Up to 5 Years (up to
24 months grace period)
|
1.90 %
|
2.55 %
|
-0.65 %
|
Up to 10 Years (up
to 30 months grace period)
|
2.15 %
|
2.80 %
|
-0.65 %
|
Up to 15 Years (up
to 36 months grace period)
|
2.40 %
|
3.05 %
|
-0.65 %
|
Up to 20 Years (up
to 60 months grace period)
|
2.65 %
|
3.15 %
|
-0.50 %
|
CABEI Financial Conditions published quarterly. Go to the
website.
"AA" Bank
CABEI is a multilateral development finance institution with
a 63-year history and 15 member countries, including all the
countries of Central America,
Panama, the Dominican Republic, Mexico, Colombia, Argentina, and Cuba, on the American continent; Spain, on the European continent; and the
Republic of Korea, and the Republic of
China (Taiwan), on the
Asian continent.
CABEI holds a AA Stable A1+ rating from S&P (September 2023), a Aa3 Stable P1 rating from
Moody's (August 2023) and a AA Stable
rating from JCR (April 2023).
Tel.: +504 2240-2222, P.O. Box 772, Tegucigalpa, M.D.C., Honduras,
C.A. www.bcie.org
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SOURCE CABEI