Carlos de los Ríos, CADIEM's Global Markets director, discusses the context in which he is joining the firm to lead the internationalisation of its business.
He highlights the investment in time, resources and expertise being made through the team working with him, in the face of the considerable challenge of adapting projects to what new investors will require.
CADIEM Casa de Bolsa y Administradora de Fondos is taking decisive steps towards internationalising the country's securities business, with a clear purpose: to be the gateway for the capital that will arrive thanks to the new landscape being built around the move to investment grade.
One of the most important decisions the company took in this regard was to expand and consolidate the division responsible for exploring opportunities abroad. That path began in 2023 with the launch of the “International Market” and the first alliances with institutions opening up new investment opportunities anywhere in the world for more sophisticated clients.
Understanding that the market's next big step in growth lies in widening borders and, above all, that local investors increasingly demand more sophisticated products, it decided to set up the Global Markets Division, with Carlos de los Ríos leading a highly qualified, well-regarded team with decades of experience in the field.
De los Ríos explained that, while the firm is now building a unit to high standards for attracting foreign investment through the capital market, the process at CADIEM began some time ago, even anticipating what would come with the first investment-grade rating in 2024 —from Moody's— and the imminence of a second rating at that level from Fitch Ratings.
“CADIEM has for years intended to reach beyond borders and have access to the world, and for the world to have access to Paraguay through CADIEM. Part of the success you can have in the financial system lies in the ability to anticipate what is coming. CADIEM saw it coming and prepared accordingly, because working with the markets requires a significant investment of time, resources and knowledge,” he said.
On this point, he explained that one important process to complete is validation by international institutions in order to be recognised as a counterparty in Paraguay. In CADIEM's case, the procedure was carried out with the Bank of New York, the world's largest custodian, which involved due diligence extremely demanding procedures until an account was opened with the firm. An approach was also made to Allfunds, the global fund distribution giant.
“CADIEM saw the opportunity for exponential growth and made a significant bet on international markets. You need the platforms and the tools to access the world, but also the right people to lead this business. The group now in charge of this division is a compact team, but highly technical and specialised in international business, with a recognised track record. No team has more years running international business than this one; there are people who have spent thirty years handling this kind of business or working at international banks, at various European and American institutions and others, with certifications that qualify them to work in this field,” added CADIEM's Global Markets director.
The opportunities of investment grade
On the impact of Paraguay's investment-grade rating (Baa3 from Moody's) and the confirmation that will come with a second one, Carlos de los Ríos recalled that it mainly means the country will appear on lists of possible destinations for investment by institutions with stricter risk-exposure requirements, which handle investment volumes larger than those usually seen locally.
“There is a question of project size; international groups require minimum tickets that you have to be able to offer. The volumes they handle are high; they may say, for example, that they can place 0.5% of their portfolio in a given project, but that 0.5% is a ticket of millions of dollars, far above the deals handled within the country. In this same sense, CADIEM is preparing, thinking about deals that meet this minimum ticket for international financial groups wanting to do business in Paraguay. A clear example is the Link Center investment fund, which in due course will be highly valued internationally,” the executive announced.
CADIEM is preparing in this way, seeking projects with minimum investment tickets in line with the flows handled by the major players in international markets, while keeping its essence of close, ongoing support for clients —whether investors or issuers— who want to access the global capital market, and for new investors wanting to enter the country.
“Paraguay was well behind in many respects when it came to the securities market, but the speed at which it is adapting is fantastic. Of course there is much still to do, but we are moving very fast and making up ground to meet international standards. CADIEM prepared for that,” added Carlos de los Ríos.
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