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PRESS RELEASE February 20, 1985

World Bank Announces its First Serial Zero Coupon Issue

The World Bank announced today an offering of a series of zero coupon bonds maturing every six months from August 15, 1985, through February 15, 2015. The proceeds will total approximately $311 million. The bonds have an aggregate face amount of $1.38 billion. Individual bonds in the series can be purchased at discounts commensurate with their maturities.

This serial zero coupon issue, the first of its kind for the World Bank, permits investors to select bonds with maturities appropriate to their particular needs and with a total return guaranteed over the life of the investment. The bonds provide an opportunity for investors to earn a known compounded market rate of return in individual maturities ranging from 6 months to 30 years. They are available in face amounts as small as $1,000. The new serial zero coupon issue will appeal to a wide range of investors--particularly individuals-–thereby making an important contribution to the Bank's efforts to mobilize private resources.

The United States and 147 other countries are stockholders in the World Bank. Since its establishment, the Bank has made loans exceeding $103 billion to its member countries. These loans are financed by the Bank predominantly through the issuance of its obligations to institutional and other investors, as well as through retained earnings and the capital subscriptions of stockholders. The Bank has made a profit each year since 1947 and anticipates record earnings in its current fiscal year ending June 30, 1985. The Bank's liquid cash reserves stood at approximately $15.2 billion as of December 31, 1984.

Application will be made to list the bonds on the New York Stock Exchange.

The new serial zero coupon issue is sole managed and underwritten by Merrill Lynch Capital Markets. The proceeds will be used in the general operations of the World Bank.