PACRA Maintains the Entity Ratings of GuarantCo Limited

The assigned ratings of GuarantCo Limited ("GuarantCo" or the “Company”) reflect its robust shareholding structure, primarily anchored within the Private Infrastructure Development Group (PIDG). PIDG is ultimately backed by six prominent development partners: (1) UK Aid from the British People (FCDO), (2) Australian Aid (DFAT), (3) Sweden (SIDA), (4) Ministry of Foreign Affairs of the Netherlands (DGIS) & (FMO), (5) Government of Canada, and (6) SECO (Switzerland). The ratings draw comfort from the continued financial support provided by the shareholders through formal support agreements. In CY24, GuarantCo secured equity injections of USD 22.7 million. The capital infusions aim to (i) reaffirm shareholder commitment and enhance market confidence, and (ii) expand the Company’s guarantee capacity in alignment with its three-year business plan. GuarantCo remains focused on strengthening local capital markets by offering innovative credit solutions for infrastructure financing, contributing to sustainable economic growth across its operating regions. Its commercial operations, including transaction execution and portfolio management, are managed by GuarantCo Management Company (GMC), a wholly owned subsidiary of Cardano Development (CD). In 2024, the Company reached financial close on eight transactions totaling USD 225 million, which led to a 14% increase in the active guarantee portfolio, from USD 753 million to USD 855 million. The guarantee portfolio is well diversified by geography and industry sector. While GuarantCo has traditionally not relied heavily on external risk mitigation, recent initiatives such as counter-guarantees from the Swedish International Development Cooperation Agency (SIDA) and reinsurance through Canopius have been undertaken to manage risk. The Company has also adopted a prudent provisioning strategy in recent years. Its investment portfolio remains conservatively structured, highly rated, and aligned with a capital preservation mandate. Liquidity indicators continue to remain strong, supporting operational resilience. However, asset quality remains a concern as macroeconomic pressures persist due to the territories in which the Company operates. In response, the Company plans to increase its use of external risk mitigation instruments over 2025 and 2026 to support the growth of its business. In CY24, GuarantCo recorded higher guarantee and investment income, resulting in a net profit of USD 5.3 million. This improvement in profitability was largely driven by an increase in portfolio size, investment income, and effective recovery efforts, coordinated centrally and executed in close collaboration with regional relationship teams.
GuarantCo's ratings are dependent on its robust ownership structure & strong liquidity buffer. Prudent expansion and close monitoring of asset quality and internal obligor rating remain critical.

About the Entity
GuarantCo Ltd. was established in 2005. GuarantCo is part of the Private Infrastructure Development Group (PIDG) and is funded by the governments of the United Kingdom, Switzerland, Australia and Sweden, through the PIDG Trust, the Netherlands, through FMO and the PIDG Trust, Canada, through the PIDG Trust and a repayable facility, plus France through a stand-by facility. Mr. Frank Gosselink has been appointed as Chief Executive Officer of GuarantCo. Mr. Frank assumed the office in October 2024. He was co-CEO of Cardano Development and the co-founder of TCX. He brings senior risk management experience from FMO and AEGON, with a background in econometrics and international development.