The International Bank for Reconstruction and Development proposes to make an offering of $100 million Twenty-Year Bonds during the month of January, Eugene R. Black, and President, announced today. The issue will be sold through a nationwide under writing group under the joint management of Morgan Stanley & Co. and The First Boston Corporation.
Several features will be incorporated in the new offering designed to meet operating practices of the World Bank and current market conditions.
Since disbursements on loans granted by the Bank are usually made over a period of several years, the Bank, in addition to offering bonds for regular delivery, will extend to certain institutional purchasers of Bonds of this new issue the privilege of making delayed payments giving them a selection of specified delivery dates between April 1, 1957 and October 1, 1959. This arrangement is expected to serve the dual purpose of coordinating a portion of the Bank's borrowing with its disbursements and of making it possible for purchasers to arrange their payments to suit their individual preferences in the light of their mm projected cash positions.
The Bonds will be nonredeemable prior to January 1, 1967. During the ten-year period 1957-1966 when the Bonds will be nonredeemable a purchase fund comprised of equal monthly amounts aggregating 5% per annum will operate to purchase Bonds available in the open market at prices up to 100% and accrued interest. Beginning in the middle of 1967 a mandatory sinking fund will be in effect which will retire $5 million of the Bonds in each year to maturity.