Washington, DC, April 20, 2010 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) priced a 5-year Norwegian Krone (NOK) global bond.
The transaction was well received by the market, with over 20 investors participating in the final order book. Investor demand was mostly split among investors in North America (64%) and Europe, Middle East and Africa (31%). A small percentage was also sold to Asian investors (5%). Asset managers were the main investor group, taking 75% of the total amount. The remainder was placed with government agencies (16%) and banks (9%).
The joint lead-managers for the transaction were J.P. Morgan and TD Securities.
Amount: NOK *2.5 billion (USD equivalent 424 million)
Settlement date: April 30, 2010
Maturity date: April 30, 2015
Reoffer price: 99.875%
Coupon: 3.375% annually
Denomination: NOK 10,000 and multiples thereof
Listing: Luxembourg Stock Exchange
Clearing systems: Euroclear or Clearstream
This is the largest NOK transaction that the World Bank has issued and its first global NOK transaction since 2002.
* On May 11, 2010, IBRD agreed to increase the principal amount with a second tranche in the amount of NOK 500 million with an issue price of 102.865% (settlement date: May 18, 2010). The new total outstanding principal amount is NOK 3 billion. On June 1, 2011, IBRD increased the principal amount with a third tranche to NOK 500 million with an issue price of 101.30% (settlement date: June 8, 2011). The new total outstanding principal amount is NOK 3.5 billion.
“We appreciate investors' reception of this Norwegian Krone global bond. As part of our demand-driven strategy, we strive to offer global bonds in a variety of currencies, so that investors can diversify their currency holdings while benefitting from the safety of World Bank products.” said Andrea Dore, Lead Financial Officer, Capital Markets, World Bank.
David Smith, Executive Director at J.P. Morgan said: “Strong U.S. institutional demand for a new 5-year benchmark was a key driver in the World Bank NOK global issue”.
Stephen Dirou, Vice President & Director at TD Securities said: “Another successful World Bank transaction as investors looked to buy one of the largest primary NOK transactions ever printed. Accounts were attracted by both the strength of the World Bank name and the positive Norwegian economic story”.
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. It operates as a global development cooperative owned by 186 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 overriding goal is to achieve major, sustainable improvements in
standards of living worldwide. It has been issuing bonds in the international capital markets for over 60 years to fund its activities. The World Bank is one of the most recognized and innovative borrowers in the international capital markets. The World Bank designed and issued the first global bond in 1989. Information on bonds for investors is available on the World Bank Treasury website: (www.worldbank.org/debtsecurities).