Washington, DC, November 16, 2015 – The World Bank (International Bank for Reconstruction and Development or IBRD, rated Aaa/AAA) is pleased to announce the launch of a new investment solution designed for retail investors in Belgium and Luxembourg – The World Bank Green Growth Bond 07/2024. The announcement comes ahead of the United Nations’ COP21 conference at the end of the month where world leaders will come together in Paris to negotiate a new global climate agreement.
Equity-linked World Bank Green Bonds have demonstrated broad investor appeal with over USD 500 million previously raised through 14 issuances, including investor types as diverse as retail, institutional investors and private banks. The benefits are clear – The World Bank Green Growth Bonds solely support the financing of socially and environmentally sustainable projects which respond to climate change, and entitle investors of that structured bond to 100% of the capital at maturity and a potential redemption premium, depending on the evolution of the underlying index.
Following the success of the World Bank’s inaugural Green Growth Bond for Belgium retail investors in January 2015, which raised USD 91 million, the World Bank is launching a new version of the Green Growth Bond. This features a green bond linked to a new index, the Ethical Europe Climate Care Index (the “Index”). Designed by Solactive in partnership with Vigeo, this Index encourages companies to improve their energy transition strategy through a unique filtering methodology that selects companies on the basis of their carbon footprint and their energy transition strategy. Environmental, social and governance (ESG) compliance and financial filters are also applied.
Many banks will distribute the product, together representing a large proportion of the Belgian market, including Belfius, BNP Paribas Fortis, KBC, Deutsche Bank, Crelan, Fintro, CBC, Bank Degroof Petercam, Puilaetco Dewaay and Bolero.
The World Bank Green Growth Bond 07/2024 will be offered to investors in Belgium and Luxembourg for a 6 weeks period starting November 16th 2015, at which time all relevant information about the product and distributing banks will be available at www.GreenGrowthBond.com.
The World Bank Green Growth Bond 07/2024 has been designed to deliver two key objectives for the environmentally conscious investor:
- Eco-citizenship: A green bond, the proceeds of which are used by the World Bank to support the financing of projects in various regions of the world aimed at addressing the challenges of climate change. The bond is linked to an equity index that selects companies based on their carbon footprint and the robustness of their energy transition strategy.
- Return on capital: Upon the 8.5-year maturity, investors are entitled to the repayment of 100% of the capital investment in US dollars by the World Bank. It may be increased by a potential redemption premium, depending on the evolution of the underlying Index.
Green Bonds: Since its first green bond launched in 2008, the World Bank has raised over USD 8.5 billion through more than 100 green bonds in 18 different currencies all over the world. All World Bank green bonds offer investors an opportunity to support environmental solutions through a bond product that benefits from the triple-A credit strength of the World Bank. World Bank green bonds support the financing of projects in member countries that meet specific criteria for low carbon and climate resilient growth, seeking to mitigate climate change or help affected people adapt to it. The types of eligible projects include renewable energy installations, energy efficiency projects, and new technologies in waste management and agriculture that reduce greenhouse gas emissions and help finance the transition to a low carbon economy. They also include financing for forest and watershed management and infrastructure to prevent climate-related flood damage and build climate resilience.
Transaction Summary | |
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
Issuer rating: | Aaa/AAA |
Amount: | USD 5 million to USD 150 million |
Issue date: | 8 January 2016 |
Maturity date: | 8 July 2024 |
Offer price: | Maximum 102% of the Specified Denomination, i.e. US dollar 102. |
Fixed Coupon: | None |
Redemption at maturity: | 100% of the capital (Excluding any fees or taxes or any type of charge) + the Redemption Premium (if any) |
Redemption Premium: | Amount in US dollar calculated by the Calculation Agent in accordance with the following: S0 means the official closing level of the Index on Initial Observation Date Si means the arithmetic mean of the closing levels of the Index on each Monthly Observation Date Si/S0 – 1 is the ‘Adopted Performance’ - If Si/S0 – 1 ≤ 0 (Adopted Performance negative or null): no premium - If Si/S0 – 1> 0 (Adopted Performance positive): premium = US$ 100 × [Si/S0– 1] (i.e. Specified Denomination multiplied by Adopted Performance) |
Underlying: | Ethical Europe Climate Care Index, a trademark owned by SOLACTIVE AG acting as index sponsor. ISIN code: DE000SLA03W2. (**) |
Initial observation date: | 8 January 2016 (provided that it is a trading day, as specified in the Final Terms) |
Monthly observation dates: | 21 December 2021, 25 January 2022, 22 February 2022, 25 March 2022, 21 April 2022, 24 May 2022, 23 June 2022, 25 July 2022, 25 August 2022, 26 September 2022, 25 October 2022, 24 November 2022, 21 December 2022, 25 January 2023, 22 February 2023, 24 March 2023, 21 April 2023, 24 May 2023, 26 June 2023, 25 July 2023, 25 August 2023, 25 September 2023, 25 October 2023, 24 November 2023, 20 December 2023, 25 January 2024, 23 February 2024, 22 March 2024, 22 April 2024, 24 May 2024 and 18 June 2024 (provided they are trading days, as specified in the Final Terms) |
Specified Denomination: | USD 100 |
Listing: | Luxembourg Stock Exchange (regulated market) |
Governing law: | English law |
ISIN: | XS1319581960 |
(*) Please see the Prospectus and Final Terms for a detailed description of the Terms and Conditions of the bonds and the related risks (including the credit risk, the liquidity risk, the risk of underpeformance of the underlying, and the Index-related risks) and possible costs and expenses with regard to an investment in the bonds, available at www.GreenGrowthBond.com as of the start of the offering period in Belgium. Any offer of the bonds will solely take place on the basis of the Prospectus and Final Terms prepared by the World Bank or on behalf of the World Bank. The Prospectus and the Final Terms have not been approved or disapproved by any competent authority in the European Economic Area. The Prospectus is not and does not comprise a “base prospectus” for the purposes of Article 5.4 of EU Directive 2003/71/EC (Prospectus Directive) and has not been submitted to, reviewed or approved by the Belgian FSMA. Each distributing bank shall communicate to its clients on request the contact details of its ombudsman or similar department in charge of the handling of claims.
(**) This Index is a Price Return index. This means that dividends distributed by this index’s equities are not reinvested into it and therefore have no direct influence on its performance, unlike a Total Return index. The future performance of the Index cannot be predicted based on its historical performance.
About the World Bank
The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody’s/S&P), is an international organization created in 1944 and the original member of the World Bank Group. It operates as a global development cooperative owned by 188 nations. It provides its members with financing, expertise and coordination services so they can achieve equitable and sustainable economic growth in their national economies and find effective solutions to pressing regional and global economic and environmental problems. The World Bank has two main goals: to end extreme poverty and promote shared prosperity. It seeks to achieve them primarily by providing loans, risk management products, and expertise on development-related disciplines to its borrowing member government clients in middle-income countries and other creditworthy countries, and by coordinating responses to regional and global challenges. It has been issuing sustainable development bonds in the international capital markets for over 60 years to fund its activities that achieve a positive impact. Information on bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities
For more information about World Bank green bonds, see: http://treasury.worldbank.org/greenbonds.
About Solactive
Solactive AG is one of the key players in the indexing space. Focusing on tailor-made indices, the German multi asset class provider is developing, calculating and distributing them worldwide. As of 30th June 2014, Solactive AG calculates indices for over 160 clients in Europe, America and Asia. Approximately 25 billion USD are invested in products linked to indices calculated by the Company globally, primarily via 145 ETFs.
Solactive is a registered trade mark of Solactive AG. Solactive does not manage, sponsor, endorse, promote or sell any investment products based on the Ethical Europe Equity Index.
About Vigeo
Founded in 2002 and led by Nicole Notat, Vigeo is the leading European expert in evaluating corporate social responsibility through six domains: environment, human rights, human resources, community involvement, business behavior, and corporate governance:
- Vigeo rating – the way to responsible investment – offers a broad range of products and services to investors and asset managers who seek a sustainable and responsible performance of their investments on more than 3,000 issuers: companies, regions and states;
- Vigeo enterprise – the way to responsible management – works directly with organizations of all sizes from both public and private sectors, conducts global CSR audits and benchmarks, supports teams and integrates CSR/SRI criteria into business functions and strategic operations.
Vigeo Rating's research meets high quality standards and has been externally certified to the Arista standard since 2009, a quality standard for SRI research. Vigeo is present in Paris, Casablanca, Brussels, Milan, London, Tokyo and Santiago of Chile and has more than 120 employees.
