North American Development Bank maintains “Aaa” rating from Moody’s
NADB received a credit rating of Aaa/Prime-1 with a stable outlook from Moody’s Investor Service.
North American Development Bank maintains “Aaa” rating from Moody’s
(San Antonio, TX) – The North American Development Bank (NADB) received a credit rating of Aaa/Prime-1 with a stable outlook from Moody’s Investor Service. NADB is a an international financial institution capitalized and governed equally by the United States and Mexico for the purpose of financing infrastructure projects that improve environmental quality in the U.S.-Mexico border region.
Moody’s based its high rating on four key factors: 1) strong capitalization; 2) a high level of liquidity; 3) the active involvement of the U.S. Department of the Treasury and its Mexican counterpart, the Secretaría de Hacienda y Crédito Público (SHCP), in loan approvals; and 4) strong shareholder support in the event of financial stress.
“The “Aaa” rating assigned by Moody’s for the second year in a row confirms NADB’s strong financial performance,” stated NADB Managing Director Gerónimo Gutiérrez. “It increases our prospects for accessing new funding under competitive terms and conditions in order to continue supporting the construction of infrastructure, especially now as we diversify our loan portfolio into other sectors like renewable energy.”
NADB’s total capitalization is US$3 billion, of which US$450 million is paid-in capital and the remainder is callable capital from the U.S. and Mexican Governments. Because of the rapid growth of its loan portfolio in recent years, NADB placed its first debt issuance for US$250 million in February 2010 to support its lending operations. According to Moody’s, the callable capital provides considerable protection for NADB’s bondholders.
Moody’s also noted that the Bank’s liquidity policy was very strong, “both in the number of months of coverage and the breadth of coverage of cash outflows. For the current fiscal year, the minimum requirement under the policy is US$50 million, and actual liquid asset holdings were US$274.4 million as of December 31, 2010. This represented 36.4% of total assets and 107.0% of total debt, a very strong position which compares favorably with other MDBs at this rating level.”
To date, NADB has contracted US$1.33 billion in loans and grants for 152 projects throughout the U.S.-Mexico border region. These projects are estimated to have a total cost of US$3.28 billion and will benefit more than 13 million border residents when fully implemented.
More information regarding NADB and its operations, including a copy of Moody’s Credit Analysis of NADB can be obtained at www.nadb.org.
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Juan Antonio Flores
210-231-8000
The North American Development Bank is a financial institution established and capitalized in equal parts by the United States and Mexico for the purpose of financing environmental infrastructure projects along their common border. As a pioneer institution in its field, the Bank is working to develop integrated, sustainable and fiscally responsible projects with broad community support in a framework of close cooperation and coordination between Mexico and the United States.