Obligation Andina Corporación de Desarrollo 1.5% ( US219868BT29 ) en USD

Andina Corporación de Desarrollo

100 % ⇌

Venezuela

US219868BT29 ( en USD )

1.5% par an ( paiement semestriel )

08/08/2017 - Obligation échue

Prospectus brochure de l'obligation Corporación Andina de Fomento US219868BT29 en USD 1.5%, échue

1 000 USD

1 000 000 000 USD

219868BT2

La Corporación Andina de Fomento (CAF) est une banque de développement multilatérale qui finance des projets d'infrastructure et de développement en Amérique latine et dans les Caraïbes.

Une obligation précédemment émise par la Corporación Andina de Fomento (CAF), une institution financière multilatérale et banque de développement au service de l'Amérique latine et des Caraïbes, ?uvrant pour soutenir l'intégration régionale et le développement durable à travers le financement de projets d'infrastructure, de développement social et de promotion du commerce, portait le Code ISIN US219868BT29 et le Code CUSIP 219868BT2. Cette émission, libellée en dollars américains (USD) et d'un montant total initial de 1 000 000 000 USD, offrait un taux d'intérêt fixe de 1,5% avec des paiements d'intérêts semi-annuels, la taille minimale à l'achat pour les investisseurs étant fixée à 1 000 USD, et bien qu'émanant d'une entité multilatérale, son pays d'émission enregistré était le Venezuela. Point crucial pour cette émission, elle a atteint sa maturité le 8 août 2017 et a été intégralement remboursée à cette date, le prix actuel sur le marché de 100% reflétant ainsi son remboursement à la valeur nominale. L'absence de notation (NR) de la part des agences Standard & Poor's (S&P) et Moody's pour cette émission spécifique indique que l'obligation n'avait pas fait l'objet d'une évaluation formelle de crédit par ces agences.

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424B3 1 d766180d424b3.htm 424B3
Table of Contents
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-189174

$1,000,000,000

CORPORACIÓN ANDINA DE FOMENTO
1.50% Notes due 2017

We will pay interest on the notes on February 8 and August 8 of each year. Interest will accrue on the notes from and
including August 8, 2014, and the first interest payment will be made on February 8, 2015. We may not redeem the notes prior to
their maturity on August 8, 2017. There is no sinking fund for these notes.
CAF will apply to the Financial Services Authority in its capacity as competent authority pursuant to Part VI of the Financial
Services and Markets Act 2000 (the "UK Listing Authority") for the notes to be admitted to the official list of the UK Listing Authority
(the "Official List") and to the London Stock Exchange plc (the "London Stock Exchange") for the notes to be admitted to trading on
the London Stock Exchange's Regulated Market. No assurance can be given by CAF that such applications will be approved. The
London Stock Exchange's Regulated Market is a regulated market for the purposes of Directive 2004/39/EC.

Underw riting
Proceeds to
Discounts and
Corporación
Price to

Andina de

Public(1)

Commissions

Fomento(1)
Per Note

99.930%

0.10%

99.830%
Total

$999,300,000
$ 1,000,000
$ 998,300,000

(1) Plus accrued interest, if any, from August 8, 2014.
Neither the United States Securities and Exchange Commission ("SEC") nor any other regulatory body has approved or
disapproved of these securities or passed upon the accuracy or adequacy of this prospectus supplement or the accompanying
prospectus. Any representation to the contrary is a criminal offense.
Delivery of the notes in book-entry form only through The Depository Trust Company will be made on or about August 8,
2014.

BofA Merrill Lynch
Deutsche Bank Securities
HSBC

The date of this prospectus supplement is August 5, 2014.
Table of Contents
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PROSPECTUS
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ABOUT THIS PROSPECTUS SUPPLEMENT

S-1
ABOUT THIS PROSPECTUS

1
FORWARD-LOOKING INFORMATION

S-2
FORWARD-LOOKING INFORMATION

2
SUMMARY OF THE OFFERING

S-3
CORPORACIÓN ANDINA DE FOMENTO

3
USE OF PROCEEDS

S-5
LEGAL STATUS OF CAF

4
CAPITALIZATION AND INDEBTEDNESS

S-6
USE OF PROCEEDS

5
SELECTED FINANCIAL INFORMATION

S-7
CAPITALIZATION AND INDEBTEDNESS

5
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
CAPITAL STRUCTURE

6
FINANCIAL CONDITION AND RESULTS OF OPERATIONS S-9
SELECTED FINANCIAL INFORMATION

13
UNAUDITED CONDENSED INTERIM FINANCIAL
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
INFORMATION AND NOTES THERETO

S-17
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
15
SUPPLEMENTARY INFORMATION (UNAUDITED)

S-33
OPERATIONS OF CAF

19
DESCRIPTION OF THE NOTES

S-36
FUNDED DEBT

30
GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES

S-40
DEBT RECORD

32
UNDERWRITING

S-41
ASSET AND LIABILITY MANAGEMENT

32
VALIDITY OF THE NOTES

S-45
ADMINISTRATION

33
THE FULL MEMBER SHAREHOLDER COUNTRIES

37
DESCRIPTION OF THE DEBT SECURITIES

40
DESCRIPTION OF THE GUARANTEES

45
TAXATION

46
PLAN OF DISTRIBUTION

51
VALIDITY OF THE DEBT SECURITIES

52
VALIDITY OF THE GUARANTEES

52
EXPERTS

52
AUTHORIZED REPRESENTATIVE

52
WHERE YOU CAN FIND MORE INFORMATION

52
INDEX TO FINANCIAL STATEMENTS

F-1
SUPPLEMENTARY INFORMATION (UNAUDITED) AS OF
DECEMBER 31, 2013

S-1

You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to
provide you with information that is different. This document may only be used where it is legal to sell these securities. The information in this
document may only be accurate on the date of this document.
This document is only being distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment
professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (as so
amended, the "Order") or (iii) high net worth entities, and other persons to whom it may lawfully be communicated, falling within Articles 49(2)(a)
to (d) of the Order (all such persons together being referred to as "relevant persons"). Any investment or investment activity to which this
document relates is available only to relevant persons and will be engaged in only with relevant persons. Any person who is not a relevant person
should not act or rely on this document or any of its contents.
In connection with the issue of the notes, Merrill Lynch, Pierce, Fenner & Smith Incorporated, as the Stabilizing Manager(s) (or persons acting
on behalf of any Stabilizing Manager(s)) may over-allot notes or effect transactions with a view to supporting the market price of the notes at a
level higher than that which might otherwise prevail. However, there is no assurance that the Stabilizing Manager(s) (or persons acting on behalf of
the Stabilizing Manager(s)) will undertake stabilization action. Any stabilization action may begin on or after the date on which adequate public
disclosure of the terms of the offer of the notes is made and, if begun, may be ended at any time, but it must end no later than the earlier of 30 days
after the issue date of the notes and 60 days after the date of the allotment of the notes. Any stabilization action or over-allotment must be conducted
by the relevant Stabilizing Manager(s) (or person(s) acting on behalf of any Stabilizing Manager(s)) in accordance with all applicable laws and
rules.

-i-
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ABOUT THIS PROSPECTUS SUPPLEMENT
The notes described in this prospectus supplement are debt securities of Corporación Andina de Fomento, or CAF, that are being offered
under a registration statement filed with the Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended (the
"Securities Act"). The accompanying prospectus is part of that registration statement.
The accompanying prospectus provides you with a general description of the debt securities that we may issue, and this prospectus
supplement contains specific information about the terms of this offering and the notes. This prospectus supplement also may add, update or change
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information provided in the accompanying prospectus. To the extent that certain information in this prospectus supplement is inconsistent with
information in the accompanying prospectus, the information in this prospectus supplement replaces the information in the accompanying
prospectus and you should rely on the information in this prospectus supplement. Consequently, before you invest, you should read this prospectus
supplement together with the accompanying prospectus.
The registration statement, any post-effective amendments to the registration statement and their various exhibits contain additional
information about CAF, the notes and other matters. All these documents may be inspected at the offices of the Securities and Exchange
Commission. Certain terms that we use but do not define in this prospectus supplement have the meanings we give them in the accompanying
prospectus.
CAF, having made all reasonable inquiries, confirms that this prospectus supplement and the accompanying prospectus contain all the
information regarding CAF and the notes which is (in the context of the issue of the notes) material; that such information is true and accurate in all
material respects and is not misleading in any material respect; and that this prospectus supplement and the accompanying prospectus do not omit to
state any material fact necessary to make such information not misleading in any material respect. CAF accepts responsibility for the information
contained in this prospectus supplement and the accompanying prospectus.
Except as otherwise specified, all amounts in this prospectus supplement are expressed in United States dollars ("dollars," "$," "US$",
"U.S.$" or "U.S. dollars").
Laws in certain jurisdictions may restrict the distribution of this prospectus supplement and the accompanying prospectus and the offering of
our notes. You should inform yourself about and observe these restrictions. See "Underwriting" in this prospectus supplement.

S-1
Table of Contents
FORWARD-LOOKING INFORMATION
This prospectus supplement and the accompanying prospectus may contain forward-looking statements. Statements that are not historical
facts, including statements about our beliefs and expectations, are forward-looking statements. These statements are identified by words such as
"believe", "expect", "anticipate", "should" and words of similar meaning.
Forward-looking statements are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of
which might not even be anticipated. Future events and actual financial and other results may differ materially from the results discussed in the
forward-looking statements. Therefore, you should not place undue reliance on them. Factors that might cause such a difference include, but are not
limited to, those discussed in this prospectus supplement and the accompanying prospectus, such as the effects of economic or political turmoil in
one or more of our shareholder countries.

S-2
Table of Contents
SUMMARY OF THE OFFERING
You should read the following summary information in conjunction with the more detailed information appearing elsewhere in this
prospectus supplement and the accompanying prospectus.

Issuer
Corporación Andina de Fomento

Securities Offered
1.50% Notes due 2017

Interest Payments
We will pay interest twice a year on February 8 and August 8 to holders of the notes
listed in the fiscal agent's records (which we expect to be the depositary or the
custodian) on the preceding January 24 and July 24. The first interest payment will be
made on February 8, 2015. We will pay interest on the notes on the basis of a 360-day
year comprised of twelve 30-day months.

Not Redeemable
We may not redeem the notes prior to their maturity on August 8, 2017.

Form and Denominations
The notes will be issued in the form of a global note held by the depositary or the
depositary's custodian. You will hold your interest in the global note through a
financial institution that has an account with the depositary. Generally, you will not
be entitled to have notes registered in your name, you will not be entitled to
certificates representing your notes and you will not be considered a holder of a note
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under the fiscal agency agreement. You may hold your interest in the global note in
denominations of $1,000 and integral multiples of $1,000 in excess thereof. See
"Description of the Notes -- Form and Denominations".

Payment of Principal and Interest
We will pay interest and the principal amount of your notes in U.S. dollars. As long
as the notes are in the form of the global note, we will pay interest and principal
through the facilities of the depositary. See "Description of the Notes -- Payments on
the Notes".

No Sinking Fund
There is no sinking fund for the notes.

Additional Amounts
We will make payments to you without withholding or deducting taxes, duties,
assessments or other similar governmental charges imposed by the full member
shareholder countries or any of their political subdivisions or agencies having the
power to tax, unless the withholding or deduction of those taxes, duties, assessments
or charges is required by law. In that event, with certain exceptions, we will pay such
additional amounts as may be necessary so that the net amount you receive after such
withholding or deduction will equal the amount that you would have received without
a withholding or deduction. (See "Description of the Debt Securities -- Additional
Payments by CAF" on page 42 in the accompanying prospectus.) Under the terms of
the Constitutive Agreement, we are exempt from all taxes and tariffs on income,
properties or assets, and from any liability involving payment, withholding or
collection of any taxes in the full member shareholder countries. See "Legal Status of
CAF" beginning on page 4 in the accompanying prospectus.

S-3
Table of Contents
Status
The notes are not secured by any of our property or assets. Accordingly, your
ownership of our notes means you are one of our unsecured creditors. The notes rank
equally with all of our other unsecured indebtedness, as described in the
accompanying prospectus. See "Description of the Debt Securities -- General"
beginning on page 40 in the accompanying prospectus.

Negative Pledge
The notes will contain a restriction on our ability to pledge or mortgage our assets.
See "Description of the Debt Securities -- Negative Pledge" on page 42 in the
accompanying prospectus.

Default
You will have certain rights if an event of default occurs and is not cured by us as
described in the accompanying prospectus, including the right to declare your notes to
be immediately due and payable. See "Description of the Debt Securities -- Default;
Acceleration of Maturity" beginning on page 42 in the accompanying prospectus.

Further Issuances
We may from time to time, without the consent of existing holders of the notes,
create and issue additional notes having the same terms and conditions as the notes
offered hereby, except for the issue date, the offering price and, if applicable, the date
of first payment of interest on the additional notes. Any such additional notes will
form a single series with the notes offered hereby, provided, however, that if such
additional notes are not fungible with the notes offered hereby for U.S. federal
income tax purposes, the additional notes will be issued under a separate CUSIP
number.

Fiscal Agent
The notes will be issued under a fiscal agency agreement between CAF and The
Bank of New York Mellon (as successor-in-interest to JPMorgan Chase Bank, N.A.),
which serves as fiscal agent, paying agent, transfer agent and registrar.

Taxation
For a discussion of the full member shareholder country and United States tax
consequences of the notes, see "Taxation -- Full Member Shareholder Country
Taxation" and "-- United States Taxation" beginning on page 46 in the accompanying
prospectus. You should consult your own tax advisors to determine the foreign and
U.S. federal, state, local and any other tax consequences to you in connection with
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your purchase, ownership and disposition of the notes.

Listing
Application will be made to the UK Listing Authority for the notes to be listed on its
Official List and to the London Stock Exchange for the notes to be admitted to
trading on its Regulated Market. No assurance can be given by CAF that such
applications will be approved.

Governing Law
The notes will be governed by the laws of the State of New York.

S-4
Table of Contents
USE OF PROCEEDS
We will use the net proceeds of the sale of the notes for general corporate purposes, including funding of our lending operations.

S-5
Table of Contents
CAPITALIZATION AND INDEBTEDNESS
The following table sets forth our capitalization and indebtedness at March 31, 2014 and does not give effect to any transaction since that
date.

At March 31, 2014

(in U.S.$ millions)
Short-term debt(1)

$
7,319.9

Long-term debt (maturities over one year)

$
13,056.8
Stockholders' Equity

Capital

Subscribed capital, paid-in and un-paid (authorized capital $10.0 billion)(2)

4,908.0
Less: Un-paid capital

(937.7)
Paid-in capital

3,970.3
Additional paid-in capital

1,396.2

Total capital

5,366.5
Reserves

Mandatory reserve

451.4
General reserve

2,012.1

Total reserves

2,463.5
Other comprehensive income

(0.2)
Retained earnings

44.7

Total shareholders' equity

7,874.5

Total long-term debt and stockholders' equity

$
20,931.3

(1) Includes deposits, commercial paper, short-term borrowings, the current portion of bonds, borrowings and other obligations, accrued interest
payable, commissions payable and the current portion of derivative instrument liabilities.
(2) In addition to subscribed capital shown in the table, CAF's subscribed capital included callable capital of $1.6 billion at March 31, 2014.

S-6
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SELECTED FINANCIAL INFORMATION
The following selected financial information as of and for the years ended December 31, 2013, 2012 and 2011 has been derived from our
audited financial statements for those periods, which were audited by our independent auditors Lara Marambio & Asociados, a member firm of
Deloitte Touche Tohmatsu Limited. The audit report of Lara Marambio & Asociados, a member firm of Deloitte Touche Tohmatsu Limited, has
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been included on page F-5 of the accompanying prospectus. Our financial statements have been prepared in accordance with U.S. Generally
Accepted Accounting Principles ("U.S. GAAP"). The following selected financial information as of and for the three month periods ended
March 31, 2014 and 2013 has been derived from our unaudited condensed interim financial information and includes all adjustments, consisting of
normal recurring adjustments, that we consider necessary for a fair presentation of our financial position at such dates and our results of operations
for such periods. The results of the three-month period ended March 31, 2014 are not necessarily indicative of results to be expected for the full
year 2014. The selected financial information should be read in conjunction with our audited financial statements and notes thereto, our unaudited
condensed interim financial information and the notes thereto and the section titled "Management's Discussion and Analysis of Financial Condition
and Results of Operations" in this prospectus supplement.

Year Ended December 31,

Three Months Ended March 31,

2013

2012*

2011*

2014

2013

(in U.S.$ thousands, except ratios)

Comprehensive Income Statement Data

Interest income

$
508,247
$
520,139
$
429,019
$
136,627
$
123,908
Interest expense

(297,293)

(281,688)

(213,028)

(76,255)

(74,741)

Net interest income

210,954

238,451

215,991

60,372

49,167
Provision (credit) to allowance for loan losses

(83,417)

(4,865)

(11,771)

(5,345)

2,203

Net interest income after provision (credit) to allowance
for loan losses

294,371

243,316

227,762

65,717

46,964
Non-interest income

15,903

9,281

4,565

4,206

3,813
Non-interest expenses

(105,646)

(91,851)

(84,571)

(29,130)

(24,744)
Net income before unrealized changes in fair value
related to financial instruments

204,628

160,746

147,756

40,793

26,033
Unrealized changes in fair value related to financial
instruments

2,129

(577)

4,823

3,948

(593)

Net income

$
206,757
$
160,169
$
152,579
$
44,741
$
25,440
Balance Sheet Data (end of period)

Current assets (net of allowance)(1)

$11,100,271
$10,021,935
$ 7,964,808
$11,217,190
$10,379,715
Non-current assets

16,318,049
14,796,400
13,773,127
$17,034,076
14,706,587

Total assets

$27,418,320
$24,818,335
$21,737,935
$28,251,266
$25,086,302

Current liabilities(2)

7,874,235
7,344,134
6,682,515
$ 7,319,902
7,905,476
Long-term liabilities

11,727,536
10,609,139
8,704,167
$13,056,806
10,319,760

Total liabilities

19,601,771
17,953,273
15,386,682
20,376,708
18,225,236
Total stockholders' equity

7,816,549
6,865,062
6,351,253
7,874,558
6,861,066

Total liabilities and stockholders' equity

$27,418,320
$24,818,335
$21,737,935
$28,251,266
$25,086,302

S-7
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Year Ended December 31,

Three Months Ended March 31,

2013

2012*

2011*

2014

2013

(in U.S.$ thousands, except ratios)

Loan Portfolio and Equity Investments

Loans before allowance for loan losses

$18,003,271
$16,355,410
$14,980,744
$18,071,738
$17,130,430
Allowance for loan losses

38,336

125,799

130,636

32,991

128,081
Equity investments

228,385

146,811

111,889

235,736

157,034
Selected Financial Ratios**

Return on average total stockholders'
equity(3)(4)

2.9%

2.5%

2.5%

2.3%

1.5%
Return on average paid-in capital(4)

5.5%

5.0%

5.0%

4.5%

2.8%
Return on average total assets(5)

0.8%

0.7%

0.8%

0.6%

0.4%
Administrative expenses divided by average
total assets

0.4%

0.4%

0.4%

0.4%

0.4%
Overdue loan principal as a percentage of loan
portfolio (excluding non-accrual loans)

0.0%

0.0%

0.0%

0.0%

0.0%
Non-accrual loans as a percentage of loan
portfolio

0.0%

0.05%

0.05%

0.0%

0.05%
Allowance for loan losses as a percentage of
loan portfolio

0.2%

0.8%

0.9%

0.2%

0.75%
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(1) Includes cash, deposits, trading, other investments, accrued interest and commissions receivable and the current portion of derivative instrument
assets and loans with remaining maturities less than one year minus allowance for loan losses.
(2) Includes deposits, commercial paper, advances and short term borrowings, accrued interest payable, bonds with remaining maturities less than
one year and borrowings and other obligations with remaining maturities less than one year and the current portion of derivative instrument
liabilities.
(3) Net income divided by annual average total stockholders' equity.**
(4) Net income divided by annual average subscribed and paid-in capital. **
(5) Net income divided by annual average total assets. **
*
Certain amounts in the 2012 and 2011 financial statements have been reclassified to conform to the current year's presentation.
**
For the three-month periods, the amounts have been annualized.

S-8
Table of Contents
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with our audited financial statements and notes thereto beginning on page F-6 of the
accompanying prospectus and with our unaudited interim financial information as of and for the three-month periods ended March 31, 2014 and
2013 and notes thereto beginning on page S-17 of this prospectus supplement.
Summary of Results
During the three years ended December 31, 2013, our net income increased at a compound average annual rate of approximately 16.4%. Our
net income for the year ended December 31, 2013 was $206.8 million, representing an increase of $46.6 million, or 29.1%, over net income of
$160.2 million for 2012. This increase resulted from loan portfolio growth and an improvement in the determination of the loan loss provision that
became effective as of September 2013 and which resulted in a loan loss provision reversal. For the year ended December 31, 2012, our net income
was $160.2 million, representing an increase of $7.6 million, or 5.0%, over net income of $152.6 million for 2011. This increase resulted from
growth in our loan portfolio and a slight increase in market interest rates.
Our net income for the three-month period ended March 31, 2014 was $44.7 million, representing an increase of $19.3 million, or 75.9%,
compared to net income of $25.4 million for the corresponding period in 2013. This increase resulted principally from growth of our loan portfolio
and a credit to allowance for loan losses compared to the corresponding period in 2013.
The reported annualized percentage increase in real GDP for 2013 for each of the full member shareholder countries at December 31, 2013
was as follows: Argentina, 3.0%; Bolivia, 6.7%; Brazil, 2.3%; Colombia, 4.3%; Ecuador, 4.5%; Panama, 8.4%; Paraguay, 13.6%; Peru, 5.6%;
Uruguay, 4.4%; and Venezuela, 1.3%.
The recent financial crisis and global economic recession have affected our business but have not had a material adverse effect on our results
of operations or financial position. Based on our investment strategy and given our investment guidelines, our liquid investment portfolio is of short
duration and has no material exposure to structured products such as mortgage-backed or asset-backed securities. Moreover, certain recent
developments, such as the European sovereign debt crisis and fluctuations in commodity prices, have not thus far impacted our operations. As of
December 31, 2013, we have one outstanding loan in Spain of $100.0 million in our loan portfolio, and 12.4% of our liquidity portfolio consists of
securities of issuers in European Union countries, including the Netherlands--3.9%, United Kingdom--1.8%, Germany--1.7%, Ireland--1.5%,
France--8.3%, Luxembourg--1.5%, Norway--0.2%, Sweden--2.7%, Austria--1.0%, Denmark--0.0% and Spain--1.1%. The volatility of credit
spreads during the past three years has varied our borrowing costs, the effect of which was partially offset by changing the interest rates we charge
our borrowers (after swaps). During 2013, the LIBOR rate, which is the basis for the interest payable on both our external debt and on the loans in
our loan portfolio decreased, which resulted in a lower net interest margin for our business.
Both 2013 and 2012 were characterized by a strong growth in our loan portfolio as a result of our strategy to expand our shareholder base,
principally through additional capital subscriptions by several of our existing shareholder countries, as well as the issuance of shares to new
shareholder countries. This led to loan portfolio growth of 10.1% in 2013 compared to 2012. We do not expect that our loan portfolio will be
materially affected by the activities of other development banks in the region, since the financing needs of our shareholder countries exceed the
current supply of lending resources. We believe that activities of other development banks are complementary to our lending operations.
On or about April 16, 2012, the Argentinean government expropriated YPF S.A., a company domiciled in Argentina, by taking over
management and announcing the introduction of legislation pursuant to which the Argentinean government would acquire at least 51% of the share
capital of YPF S.A. This legislation was

S-9
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Table of Contents
approved by Argentina's Congress on May 3, 2012. YPF S.A. is the recipient of two A/B loans from us, each for $250.0 million, dated
December 17, 2010 and October 26, 2011, respectively. As of December 31, 2013, CAF's combined exposure as lender of record to YPF S.A. is
$381.4 million while CAF's exposure as holder of the A portions under both loans is $98.1 million. YPF S.A. is current in its payments under both
loans and YPF S.A.'s current management has expressed its intention to fulfill the company's scheduled payment obligations.
Critical Accounting Policies
General
Our financial statements are prepared in accordance with U.S. GAAP, which requires us in some cases to use estimates and assumptions that
may affect our reported results and disclosures. We describe our significant accounting policies in Note 1 ("Significant Accounting Policies") to
our audited financial statements in the accompanying prospectus. We believe that some of the more significant accounting policies we use to
present our financial results involve the use of accounting estimates that we consider to be critical because: (1) they require significant management
judgment and assumptions about matters that are complex and inherently uncertain; and (2) the use of a different estimate or a change in estimate
could have a material impact on our reported results of operations or financial condition. Specifically, the estimates we use to determine the
allowance for loan losses are critical accounting estimates.
Additionally, the fair values for some financial assets and liabilities recorded in CAF's financial statements are determined according to the
procedures established by the accounting pronouncement ASC 820. As of the date of this prospectus supplement, we have not changed or
reclassified any transaction from one level to another pursuant to the hierarchy reflected in ASC 820, thereby maintaining consistency in the
application of accounting principles in this matter.
Income Statement
Interest Income
Three-Month Period Ended March 31, 2014. For the three-month period ended March 31, 2014, our interest income was $136.6 million,
representing an increase of $12.7 million, or 10.2%, compared to interest income of $123.9 million for the corresponding period in 2013. This
increase resulted principally from an increase in the interest income generated by our loan portfolio growth.
2013, 2012 and 2011. For the year ended December 31, 2013, our interest income was $508.2 million, representing a slight decrease of $11.9
million, or 2.3%, compared to interest income of $520.1 million for the year ended December 31, 2012. This decrease resulted primarily from the
decrease in market interest rates compared to the corresponding period in 2012, which more than offset the growth in CAF's loan portfolio, the
average amount of which increased by 9.6%. Average market interest rates were lower in 2013, when six month LIBOR averaged 0.43% per
annum compared with 0.68% per annum in 2012, representing a decrease of 36.8% in average six month LIBOR. Interest income for the year
ended December 31, 2012 represented an increase of $91.1 million, or 21.2%, compared to interest income of $429.0 million for the year ended
December 31, 2011.
Interest Expense
Three-Month Period Ended March 31, 2014. For the three-month period ended March 31, 2014, our interest expense was $76.2 million,
representing an increase of $1.5 million, or 2.0%, compared to interest expense of $74.7 million for the corresponding period in 2013. This increase
resulted principally from a bond liabilities increment in order to match our loan portfolio growth.
2013, 2012 and 2011. For the year ended December 31, 2013, our interest expense was $297.3 million, representing an increase of
$15.6 million, or 5.5%, from our interest expense of $281.7 million for the year ended December 31, 2012. This increase resulted primarily from
an increase in liabilities to fulfill higher funding

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requirements related to the growth in the average levels of our loan portfolio compared with 2012, as well as an increase in the funding costs
associated with an increase in the average term of our financial liabilities. The average amount of our liabilities increased by 12.6% at
December 31, 2013, compared with the average level at December 31, 2012. Interest expense for the year ended December 31, 2012 represented an
increase of $68.7 million, or 32.2%, from our interest expense of $213.0 million for the year ended December 31, 2011. This increase is attributable
to an increase in liabilities to fulfill higher funding requirements caused by the growth in our loan portfolio and our liquidity portfolio. The average
amount of our liabilities as of December 31, 2012 rose by 18.3% compared with the average level as of December 31, 2011.
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Net Interest Income
Three-Month Period Ended March 31, 2014. For the three-month period ended March 31, 2014, our net interest income was $60.4 million,
representing an increase of $11.2 million, or 22.7%, compared to net interest income of $49.2 million for the corresponding period in 2013. The net
interest income margin remained at 0.9% for the three-month period ended March 31, 2014, as compared to 0.9% for the corresponding period in
2013.
2013, 2012 and 2011. For the year ended December 31, 2013, our net interest income was $211.0 million, representing a decrease of
$27.5 million, or 11.5%, over net interest income of $238.5 million for the year ended December 31, 2012. This decrease resulted from a
combination of a decrease in market interest rates and an increase in liabilities to fulfill higher funding requirements. Our net interest income
margin was 0.9%, in 2013, compared to 1.1% in 2012 and 1.1% in 2011.
Allowance for Loan Losses
Effective as of September 2013, we implemented an improvement in the determination of the loan loss provision which resulted in a loan loss
provision reversal. This determination methodology, which we believe is in line with that of many other supranationals, incorporates recovery rates
that differ between sovereign and non-sovereign guaranteed loans.
The credit and provision in the periods described below reflect management's estimates for both general and specific provisions. The
allowance for loan losses is estimated considering the credit risk exposure, probability of default and, beginning December 31, 2013, loss given
default, based on external data provided by risk rating agencies, recognizing such effects in profit or loss for the period. A specific allowance for
loan losses is established by CAF for impaired loans. A loan is considered as impaired when, based on currently available information and events,
there exists the probability that CAF will not recover the total amount of principal and interest as agreed in the terms of the original loan contract.
See Note 1H of our audited financial statements in the accompanying prospectus for further information regarding allowance for loan losses
calculations.
Three-Month Period Ended March 31, 2014.
For the three-month period ended March 31, 2014, we recorded a credit to allowance for loan losses of $5.3 million, compared with a
provision to allowance for loan losses of $2.2 million for the corresponding period in 2013. Changes in the provision occurred mainly because of
the improvement in determination methodology discussed above.
The allowance for loan losses as a percentage of the loan portfolio was 0.2% at March 31, 2014, compared to 0.7% at March 31, 2013.
2013, 2012 and 2011.
For the year ended December 31, 2013, we recorded a credit to allowance for loan losses of $83.4 million, representing an increase of $78.6
million, or 1,614.6%, compared with our credit to allowance for loan losses of $4.9 million for the corresponding period in 2012. Changes in the
provision occurred mainly because of the improvement in determination methodology discussed above.

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Non-Interest Income
Our non-interest income consists principally of commissions, dividends and CAF's corresponding share of earnings or losses on equity
investments, which are accounted for using the equity method and other income.
Three-Month Period Ended March 31, 2014. For the three-month period ended March 31, 2014, our non-interest income was $4.2 million,
representing an increase of $0.4 million, or 10.3%, compared to non-interest income of $3.8 million for the corresponding period in 2013. The
increase was primarily the result of an increase in income from commission fees.
2013, 2012 and 2011. For the year ended December 31, 2013, our total non-interest income was $15.9 million, representing an increase of
$6.6 million or 71.4%, from total non-interest income of $9.3 million for the year ended December 31, 2012. This increase resulted principally
from an increase in commissions and other income, which in turn was mostly due to fluctuations in exchange rates. Our total non-interest income
for the year ended December 31, 2012 represented an increase of $4.7 million or 103.3%, as compared to our total non-interest income of
$4.6 million for the year ended December 31, 2011. This increase resulted principally from an increase in dividends from equity investments.
Non-Interest Expenses
Our non-interest expenses consist principally of administrative expenses, representing 99.7% and 99.1% of total non-interest expenses for the
three-month periods ended March 31, 2014 and March 31, 2013, respectively, and 98.4% of total non-interest expenses in 2013.
Three-Month Period Ended March 31, 2014.
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For the three-month period ended March 31, 2014, our total non-interest expenses were $29.1 million representing an increase of $4.4
million, or 17.7%, compared to total non-interest expenses of $24.7 million for the corresponding period in 2013. The increase resulted principally
from an increase in administrative expenses.
For the three-month period ended March 31, 2014, our administrative expenses were $29.1 million, or 0.4% of our total average assets,
representing an increase of $4.4 million, or 17.9%, compared to administrative expenses of $24.7 million for the corresponding period in 2013. The
increase resulted principally from the business growth and impact of local currency expenses and inflation in Venezuela, where our principal
executive offices are located.
2013, 2012 and 2011.
For the year ended December 31, 2013, our total non-interest expenses were $105.6 million, representing an increase of $13.7 million, or
15.0%, over total non-interest expenses of $91.9 million for the year ended December 31, 2012. The increase resulted principally from an increase
in provisions for contingencies. The total non-interest expenses for the year ended December 31, 2012 represented an increase of $7.3 million, or
8.6%, over total non-interest expenses of $84.6 million for the year ended December 31, 2011. The increase resulted principally from an increase
in administrative expenses given the expansion of our full member shareholder country base.
For the year ended December 31, 2013, administrative expenses were $104.0 million, or 0.4% of our total average assets, representing an
increase of $13.0 million over administrative expenses for the year ended December 31, 2012. The increase resulted principally from the growth in
our loan portfolio. For the year ended December 31, 2012, administrative expenses were $91.0 million, or 0.4% of our total average assets,
representing an increase of $10.0 million over administrative expenses for the year ended December 31, 2011. The increase resulted principally
from the impact of local currency expenses and inflation in Venezuela.
Equity investments, which do not have readily determinable fair values and in which we have a participation of less than 20% of the
investee's equity, are required to be recorded at cost according to U.S. GAAP. Also,

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management is required to assess the value of these investments at least annually and determine whether any value impairment is temporary or other
than temporary. Impairment charges must be taken once management has determined that the loss of value is other than temporary. As a result of
the analysis of these equity investments, management determined to take $0.0 in impairment charges on any of our equity investments in each of
2013, 2012, 2011 and the first quarter of 2014.
Balance Sheet
Total Assets and Liabilities
March 31, 2014. At March 31, 2014, our total assets were $28.3 billion, representing an increase of $0.8 billion, or 3.0%, over total assets of
$27.4 billion at December 31, 2013. The increase in assets resulted primarily from an increase in our liquidity and loan portfolios. At March 31,
2014, our total liabilities were $20.4 billion, representing an increase of $0.8 billion, or 4.0%, over total liabilities of $19.6 billion at December 31,
2013. The increase in liabilities resulted primarily from an increase in funding to respond to the demands for loans to borrowers in CAF's
shareholder countries.
2013 and 2012. At December 31, 2013, our total assets were $27.4 billion, representing an increase of $2.6 billion, or 10.5%, over total
assets of $24.8 billion at December 31, 2012. The increase in our total assets principally reflected a 15.6% increase in the liquid assets portfolio
and a 10.1% increase in the loan portfolio. At December 31, 2013, our total liabilities were $19.6 billion, representing an increase of $1.6 billion, or
9.2%, over total liabilities of $18.0 billion at December 31, 2012. The increase in our total liabilities resulted from higher funding requirements to
support a higher level of assets.

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Loans by Borrowing Country
Our total loan portfolio outstanding, classified on a country-by-country basis, according to the location of the borrower, was as follows:

At March 31,
At December 31,

2014

2013

2012

2011

(in U.S.$ millions)

(in U.S.$ millions)

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