Washington, DC, August 20, 2014 – Today the World Bank (International Bank for Reconstruction and Development, rated Aaa/AAA) priced a $12.057 million World Bank Step-Up Callable Green Bond sold to Merrill Lynch Wealth Management clients. Bank of America Merrill Lynch offered the step-up fixed rate bonds, which are callable after one year. The bonds will pay a 2.32 percent coupon per year for the first five years (stepping up to a maximum final coupon of 8.82 percent per year) and will mature on August 27, 2024, unless called earlier by the World Bank.
World Bank Green Bonds offer an opportunity for investors to support environmental solutions through a high grade fixed income investment. World Bank Green Bonds benefit from the triple-A credit strength of the World Bank and provide comparable returns to other World Bank bonds. World Bank Green Bonds support the financing by the World Bank of projects in its member countries that meet specific criteria for low carbon development. The types of eligible projects include alternative energy installations, funding for new technologies that reduce greenhouse gas emissions, reforestation, watershed management and flood protection among others.
“We are pleased to work with Bank of America Merrill Lynch to provide an opportunity for their clients to help finance activities that promote low carbon and climate resilient development and growth in emerging economies. We are delighted with the strong demand for this product, demonstrating that individual investors also have a keen interest in the issue of climate-smart development,” said Doris Herrera-Pol, Director and Global Head of Capital Markets at the World Bank.
“Clients continue to turn to us for opportunities to express their social, political and environmental values through their investments,” said Andy Sieg, head of Global Wealth and Retirement Solutions for Bank of America Merrill Lynch. “This offering represents another milestone in our efforts to help individuals and families achieve their goals through investments with social purpose.”
“We are pleased to work with the World Bank once again to offer clients the opportunity to invest in securities that can benefit the environment. As demand for these products continues grow across a wide range of investors, we look forward to continuing our partnership with the World Bank in this area,” said Andrew R. Karp, co-head of Americas Investment Grade Capital Markets at Bank of America Merrill Lynch.
This offering of green bonds is consistent with the Sustainable Energy for All Initiative. It demonstrates how green bonds are attracting new capital, not only from institutional investors, but also from individual investors. This is the third time World Bank Green Bonds have been offered to individual investors through Bank of America Merrill Lynch. The World Bank has been a leader in developing the Green Bond market from an issuer’s standpoint, while Bank of America Merrill Lynch continues to be a leader in the development of this market as an underwriter. Merrill Lynch Wealth Management, an innovator in the rapidly growing social impact investing arena, was the first U.S. wealth management firm to offer such World Bank Green Bonds to U.S. individual investors.
Issuer: World Bank (International Bank for Reconstruction and Development, IBRD)
Issuer rating: Aaa/AAA
Amount: USD 12.057 million
Settlement date: August 27, 2014
Maturity date: August 27, 2024
Issue price: 100%
Year 1-5: 2.32%
Year 6-8: 2.57%
Next 6 months: 3.32%
Next 6 months: 4.82%
Next 6 months: 7.32%
Next 6 months: 8.82%
Early redemption: The Issuer can call the Notes early at par, plus accrued interest, semi-annually beginning on 27 August 2015
Denomination: USD 1,000
Clearing system: The Depository Trust Company, also known as DTC
Lead managers: Bank of America Merrill Lynch
* Please see the Final Terms for a detailed description of the Terms and Conditions of the note
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 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 and by coordinating responses to regional and global challenges. It has been issuing bonds in the international capital markets for over 60 years to fund its activities. 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