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Fitch Rates Corporacion Andina de Fomento's AUD Senior Notes 'AA-'
August 27, 2013 / 6:03 PM / 4 years ago

Fitch Rates Corporacion Andina de Fomento's AUD Senior Notes 'AA-'

(The following statement was released by the rating agency) NEW YORK, August 27 (Fitch) Fitch Ratings has assigned an 'AA-' rating to Corporacion Andina de Fomento's (CAF) three-year Australian (AUD) dollar senior unsecured notes. A full list of CAF's current ratings follows at the end of this press release. Based on the documentation provided, CAF issued AUD350 million fixed-rate senior unsecured notes under its Australian medium term note programme. The notes carry a 4.25% coupon and will mature on Sept. 1, 2016. Interest payments will be paid semi-annually commencing on March 1, 2014 up to and including the maturity date. CAF is the first Latin American issuer to access the Australian debt market. The proceeds will be used for general business purposes. Considering the multilateral bank's financial profile, the impact on CAF's leverage of this issuance is not deemed significant by Fitch. KEY RATING DRIVERS CAF's ratings reflect its solid financial profile and the privileges and immunities conferred on it by its member countries. However, the member countries' creditworthiness relative to higher rated multilateral development banks (MDB) as well as still relevant loan concentrations, weigh on the entity's Issuer Default Ratings (IDRs). RATING SENSITIVITIES The rating on the senior notes is sensitive to any change in CAF's long-term foreign currency IDR. The Stable Outlook on CAF's IDRs reflects Fitch's expectation of continued conservative risk management, which should sustain CAF's steady financial performance and a risk profile compatible with its current ratings. Though not likely in the near term, CAF's ratings could benefit from a sustained reduction of loan concentrations, as well as material improvements in its borrowers' creditworthiness or in capitalization ratios. A stress situation in a member country that significantly affects asset quality or results in the invalidation of CAF's preferred creditor status or transfer and convertibility restrictions for private sector borrowers would be negative for creditworthiness. Additionally, a prolonged decline in capitalization related to asset losses, rapid operations growth or increased earnings volatility as well as a structural weakening of liquidity could also be negative for CAF's ratings. KEY ASSUMPTIONS The ratings and Outlook are sensitive to a number of assumptions. Fitch assumes that member countries, even if experiencing severe difficulties (such as Argentina, rated 'CC'), will continue to honor CAF's preferred creditor status and exempt its private sector borrowers from any measures that may impact the transfer and/or convertibility of their debt service payments, should any member country decide to default selectively to their creditors. Fitch also assumes that shareholder support will remain strong, with the expectation that paid-in capital contributions will continue to be received on time from CAF's member countries. Fitch currently rates CAF as follows: --Long-term Issuer Default Rating (IDR) 'AA-'; Outlook Stable; --Short-term IDR 'F1+'; --Senior unsecured debt 'AA-'; --Commercial paper 'F1+'; --Long-term National Rating in Venezuela 'AAA(ven)'; Outlook Stable(The 'AAA(ven)' rating is equivalent to an 'A1' rating when using the mandatory rating scale required by the local Securities Exchange Commission); --Short-term National Rating in Venezuela 'F1+(ven)'; --Long-term National Debt Rating in Mexico 'AAA(mex)'; --Long-term National Debt Rating in Panama 'AAA(pan)'. Contact: Primary Analyst Theresa Paiz Fredel Senior Director +1-212-908-0534 Fitch Ratings, Inc. One State Street Plaza New York, NY 10004 Secondary Analyst Eric Paget-Blanc Senior Director +33 1 44 29 91 33 Media Relations: Elizabeth Fogerty, New York, Tel: +1 (212) 908 0526, Email: Additional information is available at ''. Applicable Criteria and Related Research: --'Rating Multilateral Development Banks' (May 23, 2012). Applicable Criteria and Related Research: Rating Multilateral Development Banks here ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: here. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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