CAF issues bond for US$382 million to finance green projects

The Latin American development bank CAF issued US$382 million in the Swiss market to finance green projects that contribute to the adaptation and mitigation of climate change, the financial institution reported on Wednesday.

The green bond was placed by Credit Suisse and Deutsche Bank, has a maturity of five years and a coupon of 0.45%, CAF said in a statement released in Panama, adding that this is its first transaction “with Term SOFR coverage, of according to the plan established by the Libor rate substitution institution”.

CAF’s executive president, Sergio Díaz-Granados, stated that “this placement of bonds in the Swiss market is an example of CAF’s ability to attract new international resources at favorable rates to face the main challenge facing the region and the planet. : climate change”.

“These resources are part of our intention to become the green bank in Latin America,” said Díaz-Granados.

The multilateral specified that the bond issued in the Swiss market is intended to finance clean mass transportation projects, renewable energy and biodiversity protection, among other initiatives that contribute to the adaptation and mitigation of climate change.

CAF announced in May 2018 that it had made its first green bond issue, for US$52.2 million, placed at a ten-year term and a 6.75% coupon.

The operation was carried out by JP Morgan and was part of CAF’s Green Bond Issuance Program for a total amount of US$600 million, which will finance projects “with high environmental and social impact” in Ecuador, Panama and Peru, The bank then specified in a public statement released in the Panamanian capital.