Central American Bank Makes Major Move with GBP Bond Issuance in Sterling Market

CABEI Expands Footprint in Global Capital Markets

The Central American Bank for Economic Integration (CABEI) has recently made headlines by successfully entering the sterling market with its first benchmark bond issuance. This move marks a significant milestone for the institution, recognized for its strong credit rating of AA/Aa3 by S&P and Moody's. With a fundraising goal of £750 million, CABEI received an overwhelming response from investors, particularly from the UK, showcasing the bank's robust reputation and renewed financial strength.

A Landmark Transaction

On February 13, 2025, CABEI announced that its inaugural bond, structured under a Reg S format, was issued as a three-year note with a sustainable label. Since its inception, CABEI has prioritized diversifying its funding sources, and this latest issuance brings the total number of currencies in which it has issued debt to 27. This commitment not only enhances the bank's liquidity but also reinforces its high credit rating.

CABEI's bond issuance attracted significant demand, with the order book exceeding £3.1 billion, demonstrating a remarkable oversubscription of 10.3 times the initial target and 4.1 times the amount issued. This unprecedented level of interest allowed CABEI to optimize pricing while raising more funds than initially expected.

Commitment to Sustainable Development

The proceeds from this bond will be allocated to finance or refinance eligible projects under CABEI's Sustainable Bond Framework. This is in line with their mission to foster economic, social, and environmental development in member countries. The issuance aligns with global trends towards responsible investment and sustainable financing, emphasizing CABEI's role as a leader in the sector.

CABEI's Executive President, Gisela Sánchez, expressed her gratitude for the strong support received from investors during this historic transaction. She highlighted this achievement as a testament to the growing partnership between CABEI, its member countries, and the United Kingdom. This collaboration not only enhances access to new financing avenues but also promotes the sharing of expertise in sustainable initiatives.

A Strong Syndicate Partnership

The successful bond was structured by a syndicate of reputable banks, including Barclays Bank, BNP Paribas, and Bank of America. Legal representation was provided by the well-known law firm Gibson, Dunn & Crutcher LLP, ensuring that the transaction adhered to the highest standards of corporate governance and regulatory compliance.

This debut in the sterling market is not just a financial transaction, but a strategic move that positions CABEI as a key player in global ESG (Environmental, Social, and Governance) initiatives. The bank's ongoing efforts to innovate and adapt to changing market conditions reflect its commitment to sustainable financing, underscoring its prominent position in the global capital landscape.

With more than $2.43 billion raised in various sustainable initiatives for 2025 alone, CABEI is set to continue its trajectory of success and influence in promoting sustainable development across Central America and beyond. As the world increasingly turns its attention to responsible investment, CABEI's actions may serve as a blueprint for other institutions aiming to align financial goals with sustainability.