CABEI announces entry into force and launch of reforms to its Constitutive Agreement

09/06/2016

The reforms will optimize the relationship between the Bank’s nature and its objective and lead to improved loan conditions and the adhesion of new members.

Tegucigalpa, June 9, 2016.- The new reforms to the Constitutive Agreement of the Central American Bank for Economic integration (CABEI),which were approved by the Board of Governors in 2015,entered into force today. They seek to establish a governance structure that reflects the Bank’s alignment with the Central American Integration System (SICA), consolidate CABEI’s position as a preferential creditor and the support of its members, continue strengthening its capital base and increase the diversification of its loan portfolio.

The reforms include changes in the definition of CABEI’s nature and objective, the characterization of its members and conditions for contracting guarantees or loans, as well as provisions for the adhesion of new members in order to offer them options that are adapted to their particular conditions.

“This group of measures is aimed at maintaining the Bank’s sound financial position, which is reflected in optimum capitalization levels that permit it continue its leadership role in financing projects and initiatives that foster the region’s development and integration,” stated CABEI Executive President Dr. Nick Rischbieth.

In that regard, Dr. Rischbieth emphasized that, “The modifications to the Constitutive Agreement are pursuant to the needs and realities of the countries in the region; they seek to boost the Bank’s growth so that it can support projects that generate quality employment in order to reduce poverty and social inequality.”

In order to foster the region’s growth, CABEI has made a number of changes in order to improve its risk rating even more and make the institution more attractive to potential new members or public international organizations. The reforms will also lead to greater diversification of the Bank’s loan portfolio.

In this respect, it was the change of category of Panama, the Dominican Republic and Belize to non-founding regional members that represents a milestone for the Bank since it opens the possibility for them to have a permanent titular seat on the CABEI Board of Directors, putting them on an equal footing as the original founding member countries.

 

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