IDB Invest Issues a Domestic Bond in Paraguay to Support Development Projects
IDB Invest issued its fifth bond denominated in Paraguayan guaranies, to finance private sector operations through Banco Atlas. The issued amount was 90 billion guaranies (approximately $12 million), with a 5-year tenor, and will support development projects in Paraguay.
This transaction will allow Banco Atlas to create a new program focused on promoting long-term projects in the agricultural and livestock sector, with the aim of financing or refinancing investments that promote productivity improvements in the sector. It will also provide greater access to medium and long-term financing for companies in the productive sector.
The objective of IDB Invest’s bond issuance program in Paraguay is to finance private sector projects in Paraguay that require local currency.
Orlando Ferreira, Chief Finance Officer of IDB Invest, said, “We are very proud to have been the first multilateral development bank to issue a local currency bond in Paraguay in 2018. Local capital markets solutions are a powerful tool and allow issuers to finance projects with longer tenors and in local currencies. We are committed to increasing access to local currency for our private sector clients to promote sustainable development.”
Cadiem acted as dealer for this issuance. The strong demand was a result of a diversified investor base, reflected in orders that exceeded 2.12 times the amount offered. IDB Invest’s issuance was allocated to 12 investors, among private and public pension funds, public and private entities, insurance companies and mutual funds – demonstrating IDB Invest’s success in achieving its mission to develop local capital markets.
Additionally, the allocation to some of the investors will potentially promote the opportunity for secondary market trading, further strengthening local capital markets.
IDB Invest is offering more local currency options to its clients to help them mitigate currency and interest rate risks. Local currency allows private sector companies to focus on their operations rather than taking unnecessary market risk. This leads to better development outcomes, allowing companies to expand their activities, create more employment opportunities and increase productivity.
This operation contributes to two Sustainable Development Goals (SDG) of the United Nations Organization: Decent Work and Economic Growth (SDG 8), Reduced Inequalities (SDG 10).
Since 2016, IDB Invest has committed more than $1.7 billion in Paraguay, financing private sector activities that contribute to the country’s development in areas such as manufacturing, small and medium enterprises, agribusiness and financial markets.
About IDB Invest
IDB Invest, a member of the Inter-American Development Bank Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $16.33 billion in assets under management and 394 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
About Banco Atlas S.A.
Banco Atlas S.A. was founded in 1989 and began operations as a financial institution. It is part of the AZETA economic group, which has more than 70 years of experience in different sectors of the economy. After a long career as a financier, in 2010 it began operating as a bank, under the name Banco Atlas S.A. Currently, Atlas is positioned and consolidated in the industry as a banking entity with progressive and sustained growth. It has a base of more than 158,000 active clients and a diversified portfolio by economic sector. The Atlas customer service network has 27 offices with national coverage and a robust digital platform that allows customers to carry out all their procedures. As a result, 66% of customer transactions are carried out digitally through the app. and home banking.
CADIEM Casa de Bolsa S.A, has been in the Paraguayan Stock Market for 20 years, was founded in 2003 at the very beginning of the stock market, with the aim of contributing to its development through the offer of various products and financial services. A benchmark in the market, with the largest portfolio of investors in the country and a broad portfolio of products, it seeks to improve people's quality of life through savings, investment, and personal finance education.