The World Bank announced today that it intends to prepay its 8.6 percent Japanese yen bonds of 1981 due 1996 (Series 14) at the next prepayment date on November 19, 1987. The amount to be prepaid is Yen 28,905 million (currently, about $193 million), including the prepayment premium to investors of 2.5 percent of par.
The World Bank has decided to prepay this bond issue because its yield is appreciably higher than current market levels. Accordingly. The prepayment will lower the Bank's cost of outstanding debt and enable it to pass that benefit on to developing member countries. In prepaying these bonds, the Bank is pursuing its general policy of exercising its prepayment rights in all markets where such action obtains for its borrowing member countries substantial benefits. The Bank recently prepaid two Swiss franc public issues and a Luxembourg franc public issue, and also has given formal notice of intent to prepay two additional Swiss franc public issues.
