Standard & Poor’s CABEI’s Rating Outlook Revised to Positive

Tegucigalpa. Honduras, July 13, 2016 Standard & Poor’s (S&P) revised its outlook on the Central American Bank for Economic Integration (CABEI) to positive from stable, while also affirming its ‘A’ and ‘A-1’ long- and short-term international credit ratings, respectively.

According to the press release issued by S&P, the positive outlook reflects CABEI’s recent efforts in expanding its membership base, increasing its paid-in capital, and diversifying its loan portfolio; as objectives that are expected to be achieved as a result of the amendments to the Bank’s Constitutive Agreement that came into effect on June 9, 2016.

Furthermore, the rating agency stated that the Bank’s increasing importance for the Central American region and the strengthening of its relationship with shareholders, contribute to the enhancement of its business profile, which, in the framework of its methodology for assessing Multilateral Development Banks improved to “strong” from “adequate”.

In addition, S&P emphasized CABEI’s long track record of fulfilling its public policy mandate, which according to the rating agency cannot be readily fulfilled by another private or domestic public institution, and is enhanced by the Bank’s close links to the region and its timely response to its members’ needs.

S&P also indicated that CABEI’s shareholder support is reflected in the timely payment of capital installments under its current capitalization process, the requests made by the Republic of Panama and the Dominican Republic to increase their shareholder position within in the Bank’s capital structure, which will generate new capital contributions for an aggregate amount of US$98.2 million over the next four (4) years, and the expectation that the Bank will continue to strengthen its capital position through a new capital increase.

CABEI’s Executive President, Dr. Nick Rischbieth stated that S&P’s improvement of the Bank’s rating outlook is a result of the Board of Governors’ decision to modify the Constitutive Agreement and other related regulations, which came into effect on June 9, 2016; and will have a positive impact on the Institution’s credit profile.

Dr. Rischbieth also emphasized that continuous improvements on CABEI’s credit rating strengthen the Institution’s role as the financial arm of the Central American Integration System.