The African Development Bank (AfDB) and the Central American Bank for Economic Integration (CABEI) have signed a Letter of Intent in Washington D.C. to advance balance sheet optimization in line with G20 recommendations on capital adequacy frameworks for multilateral development banks. The agreement was concluded on the sidelines of the 2026 Spring Meetings of the International Monetary Fund and World Bank Group by senior representatives from both institutions, marking the beginning of a deeper strategic partnership.
The initiative aims to strengthen collaboration between the two development banks through improved knowledge sharing on financial instruments, development financing practices, and institutional capacity building. These efforts are expected to enhance economic growth and social welfare across member countries by improving the efficiency and impact of development financing.
Both institutions also signalled their intention to formalise their cooperation further through a future Memorandum of Understanding. This would support more advanced joint initiatives, including potential exposure exchange agreements and participation in bond issuances, reflecting growing confidence in coordinated financial operations between the two banks.
Officials from both sides described the agreement as an important milestone in institutional cooperation. They highlighted shared financial strengths and similar sovereign risk profiles, noting that previous collaboration in benchmark issuances has already demonstrated strong potential for mutual benefit and expanded partnership opportunities.
CABEI, a multilateral development bank with 15 member countries across Central America, Latin America, Europe, and Asia, has played a significant role in regional financing, accounting for around half of multilateral development bank funding in Central America over the past two decades. The institution maintains strong credit ratings and aims to use its financial strength to support long-term development and regional transformation.
