Corporate Presentation September 2016 COFIDE, We are The - PowerPoint PPT Presentation

Corporate Presentation September 2016

COFIDE, We are The Development Bank of Peru We are committed to sustainable and inclusive development of our country and all Peruvians, fostering an innovative, socially responsible and human capital culture, oriented to excellence in management. To encourage and promote our vision, we base our strategy on generating development through triple bottom line management, seeking to have a positive impact on social, economic and environmental issues.

Disclaimer The material that follows is a presentation of general background information about Corporación Financiera de Desarrollo S.A. and its subsidiaries (“COFIDE”), as of the date of the presentation, prepared solely for purposes of meetings with potential. The material contained herein is in summary form and does not purport to be complete. This presentation contains statements that are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. Such forward-looking statements are not guarantees of future performance. We caution you that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of COFIDE that may cause actual results to be materially different from any future results expressed or implied in such forward-looking statements. Although COFIDE believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to COFIDE’s management, COFIDE cannot guarantee future results or events. COFIDE expressly disclaims any duty to update any of the forward-looking statements, or any other information contained herein. .

Key Investment Highlights 1  Key Government Policy Tool for Economic Development 2  Peruvian Economy Provides Opportunity-Rich Environment 3  Central Element of Government Infrastructure Promotion Policy 4  Leader in Providing Financing to Small and Medium Enterprises (SME) 5  Effective Risk Management Culture and Policies Reflected in Strong Portfolio 6  Solid Capital Structure and Financial Performance

COFIDE at a Glance  The Republic of Peru (through FONAFE) owns 99.23% Who Owns Us  CAF owns the remaining 0.77%  Provide financing for infrastructure and environmental projects to close Peru’s infrastructure gap  We spearhead infrastructure projects by providing early financing What We Do  Provide financing for underserved market segments, particularly in SME lending sector  Investment Financing: assume project exposure at key junctures  Intermediation Financing: financing through regulated financial institutions  Investment Management Services: manage funds on behalf of the Peruvian government, agencies and How We Do It financial institutions  We lend under standard market conditions  Expected to participate in projects totalling ~20% of Peru’s infrastructure pipeline for the next 2 years Our Contribution to  Should disburse at least US$1.0Bn in the next 2 years Peru’s Infrastructure  It includes important projects such as South Peru Gas Pipeline and Lima Subway Line 2.  The Superintendencia de Banca, Seguros y Administradoras de Fondos de Pension (“SBS”) Our Regulator  Operate under same regulatory environment that the rest of the financial institutions in Peru  Moody’s: Baa2 (Peru: A3)  S&P: BBB+ (Peru: BBB+) Our Ratings  Fitch: BBB+ (Peru: BBB+)  Our Past-due Loan ratio is 0.82% as of September 2016 Our Asset Quality

Ownership Assures Government Support Sovereign-owned development bank established in 1971  Autonomous board of directors manages day-to-day operations independently of the Peruvian Government  Part of the National Financial System and regulated by the Superintendencia de Banca Seguros y AFPs (SBS)  Capital Adequacy Ratio (1) International Credit Ratings 49.8% 50.1% 45.8% Moody’s S&P Fitch 44.1% 38.6% 36.3% Republic A3 BBB+ BBB+ 30.5% 29.7% of Peru (stable) (stable) (stable) Baa2 BBB+ BBB+ COFIDE (stable) (stable) (stable) 2009 2010 2011 2012 2013 2014 2015 Sep 2016 100% CAF FONAFE  CAF, a regional development bank  FONAFE was created in 1999 established in 1970, acquired its to oversee the Peruvian stake in COFIDE in 1997 Government’s corporate activities and equity stakes 99.23% 0.77%  US$34.3Bn in assets (US$21.2Bn in loans) as of June 2016.  Board of directors of six Ministers appoints management team for the  CAF ratings: Aa3 / AA- / AA- Peruvian Government’s majority holdings, including COFIDE Notes: (1) Capital adequacy ratio calculated as regulatory capital over risk weighted assets .

Peruvian Economy Keeps Growing… Continued GDP Growth (%) Rising GDP per Capita (US$) 9.80% 6,609 6,550 6,390 215 6,122 8.90% 8.80% 9.90% 5,732 8.90% 7.70% 195 5,056 6.90% 7.90% 6.30% 175 4,245 4,179 6.90% 3,611 5.02% 155 5.90% 3,144 2,715 4.90% 4.00% 135 2.40% 3.26% 3.90% 115 2.90% 0.90% 1.90% 95 0.90% 75 -0.10% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Sep 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Real GDP Growth (%) Nominal GDP (US$Bn) Source: World Bank Source: Central Reserve Bank of Peru. Significant International Reserves (US$Bn) (2) Stable Debt / GDP (%) 41.7% 65.7 64.0 62.3 61.5 61.6 33.9% 29.9% 26.9% 27.2% 24.3% 22.1% 20.4% 19.6% 20.0% 23.3% 22.2% 48.9 44.0 33.8 31.2 27.7 17.3 14.1 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Jun 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Sep 2016 2016 Source: Central Reserve Bank of Peru Source: Central Reserve Bank of Peru

…and Remains Strong Sustained Fiscal Surplus – Fiscal Balance /GDP (%) Moderate Inflation (CPI, % change) 6.7% 2.3% 2.9% 2.4% 4.7% 2.0% 2.3% 4.4% 3.9% 0.9% 2.6% 2.9% 3.2% 3.1% 2.1% (0.2)% (0.2)% 1.5% 1.1% (0.3)% (0.3)% (1.3)% (2.1)% 0.2% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Jun 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Sep 2016 2016 Source: Central Reserve Bank of Peru. Source: Central Reserve Bank of Peru Note: First quarter 2016 data on 12-month rolling basis. Sustained Investment / GDP (%) Low Unemployment (%) % of unemployed population / formal labor force 25.2% 25.7% 26.2% 27.9% 26.3% 26.0% 23.7% 27.5% 22.3% 8.1% 8.9% 20.9% 7.9% 7.6% 7.5% 6.9% 19.2% 6.5% 5.5% 6.2% 6.7% 6.6% 16.2% 5.2% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Aug 2016 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Jun 2016 Source: Central Reserve Bank of Peru. Source: National institute of statistics and informatics of Peru Note: First quarter 2016 data on 12-month rolling basis.

Strong Macro Fundamentals Versus Regional Peers Higher GDP Growth Controlled Fiscal Balance 5-Year Average Real GDP Growth (%) 5-Year Average Fiscal Balance/GDP (%) 03 – '07 08 – '12 13 – '17E 03 – '07 08 – '12 13 – '17E 8.0 8.0 6.5 6.5 5.4 5.6 5.5 6.0 4.0 3.9 4.0 4.0 3.8 3.6 3.4 0.6 4.0 3.2 0.6 0.5 0.2 2.4 2.4 0.0 1.9 (0.2) (0.1) 2.0 (2.2) (2.1) (2.6) (2.6) (2.7) (4.0) (3.2) (3.6) 0.0 (3.6) -2.0 -0.9 (8.0) Peru Chile Mexico Colombia Brazil Peru Chile Mexico Colombia Brazil Decreasing Indebtness Low Country Risk Perception 5-Yr CDS (12 Month Average bps) 5-Year Average External Debt/GDP (%) 80 03 – '07 08 – '12 13 – '17E A+ BBB BBB+ BB BBB+ 387 400 60 44 41 41 39 300 40 31 29 28 202 24 24 22 22 20 200 164 20 143 14 20 12 98 100 0 Peru Chile Mexico Colombia Brazil 0 Chile Colombia Mexico Brazil Peru Source: IHS Source: Bloomberg, S&P. The credit rating is the lowest available rating for long- term foreign debt for each country.

Overview of Main Lines of Business Investment Financing Financial Intermediation  Finances primarily the SME sector, complementing the  Focused primarily on the financing of infrastructure projects undertaken by private or sovereign-owned companies. private financial sector by providing medium and long-term Mainly energy and transportation projects, as well as key financing environmental initiatives.  Lending takes place only through Peruvian Intermediary Financial Institutions (IFI), including commercial banks,  Funding infrastructure projects through Peruvian or foreign IFIs, and also by investing directly in debt instruments municipal and rural banks, credit unions and entities used to finance projects specializing in SME financings  COFIDE’s credit exposure is to the investment project  COFIDE’s credit exposure is to the IFI, rather than the financed by the ultimate borrower in the event of default ultimate borrower Financial Income Breakdown by Line of Business Other, 4.2% Financial Intermediation, 25.3% Investment Financing, 70.5% Financial Income: US$ 140.7 mn as of September 2016 Other includes Interest Earning over available cash