World Bank Issues $3.5 Billion 10-Year Sustainable Development Bond

Published February 3rd, 2021 - 09:30 GMT
World Bank Issues $3.5 Billion 10-Year Sustainable Development Bond
The bond priced with a final spread to mid-swaps of +13 basis points and an equivalent annual yield of 1.278%. (Shutterstock)

The World Bank (International Bank for Reconstruction and Development, IBRD) has priced a $3.5 billion 10-year Sustainable Development Bond maturing in February 2031.

The transaction, in the World Bank’s largest funding currency, appealed to investors seeking longer-dated US dollar bonds complemented by a sustainable development purpose that resonates especially with investors integrating Environmental, Social and Governance (ESG) criteria in their investment process.

The deal attracted over 115 orders totalling more than $4.8 billion. Investors were globally diverse, with strong demand from central banks and official institutions as well as, pension funds, insurance companies and asset managers seeking high-credit quality assets to match their longer-term liabilities.

BofA Securities, Citi, JP Morgan, RBC Capital Markets are the lead managers for the transaction. The bond will be listed on the Luxembourg Stock Exchange.

The bond priced with a final spread to mid-swaps of +13 basis points and an equivalent annual yield of 1.278%. This equates to a spread vs. the reference US treasury of +18.25 basis points.

“We are grateful for investors’ support for this 10-year US dollar benchmark which helps to fund the World Bank’s efforts to help our member countries respond to the immediate crisis and achieve their sustainable development goals,” said Jingdong Hua, Vice President and Treasurer, World Bank. “Access to long-term consistent funding supports a green, inclusive, resilient and sustainable recovery.”

“Another impressive result for the World Bank in executing this $3.5 billion 10-year benchmark. The transaction was met with strong investor demand, attracting over 100 orders. The combination of growing investor interest following the deal’s announcement and an extremely high quality orderbook allowed them to price at the tightest spread to mid-swaps in this tenor of any Sovereign, Supranational, and Agency (SSA) issuer in the past three years. Congratulations to the World Bank team on this landmark issuance,” said Adrien de Naurois, Head of DCM SSA & EMEA IG Syndicate, BofA Securities. 


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