Washington, DC, October 22, 2014 – The World Bank (International Bank for Reconstruction and Development, IBRD, rated Aaa/AAA) announced a USD 50 million 2-year fixed to floating rate callable World Bank green bond that was issued in response to demand from the California State Teachers Retirement System (CalSTRS). Barclays was the sole lead manager for this transaction.
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 of projects in its member countries that meet specific criteria for low carbon development and resilient investments. The types of eligible projects include alternative energy installations, funding for new technologies that reduce greenhouse gas emissions, reforestation, watershed management and flood protection that build climate resilience among others.
“For CalSTRS, this is an excellent opportunity to add to our $133.2 million green bonds investment portfolio while also seizing on an attractive short-term strategy that we feel benefits us, the issuer, and the planet,” said CalSTRS Chief Investment Officer Christopher J. Ailman.
“This marks a further step in the development of the green bond market. The World Bank appreciates the ongoing collaboration with CalSTRS as a committed green bond investor and is pleased to have structured this green bond based on CalSTRs specific investment preferences”, said Doris Herrera-Pol, Director and Global Head of Capital Markets at the World Bank.
“This is another milestone for the World Bank's green bond programme with this new transaction amongst the largest green MTNs in the US Structured Note market to date. This new deal highlights not only the World Bank's commitment to continuing to develop this market, but also the close and trusted relationship that this issuer has with the green bond investor community. Barclays was honoured to be involved in this project and remains committed to developing the green bond market”, said Susan Barron, Managing Director, SSAR DCM Origination at Barclays.
Transaction Summary:
Issuer: World Bank (International Bank for Reconstruction and Development, IBRD)
Issuer rating: Aaa/AAA
Amount: USD 50,000,000
Settlement date: October 20, 2014
Maturity date: October 20, 2016
Early redemption date: The Issuer has the option to call the notes on October 20, 2015 and quarterly thereafter with 5 Business Days notice
Coupon: From and including the Issue Date to but excluding October 20, 2015: 0.350% per annum. From and including October 20, 2015 to but excluding the Maturity Date: 3-month USD LIBOR + 0.10% per annum, subject to a Minimum Interest Rate of 0% per annum and a Maximum Interest Rate of 1.55% per annum
Issue price: 100%
Denomination: USD 200,000
Clearing system: DTC
Sole lead manager: Barclays Capital Inc.
ISIN: US45905UQN71
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 sustainable development bonds in the international capital markets for over 60 years to fund its activities that achieve a positive impact. Information on bonds for investors is available on the World Bank Treasury website: (www.worldbank.org/debtsecurities).
About the CalSTRS
The California State Teachers’ Retirement System, with a portfolio valued at $186.4 billion as of September 30, 2014, is the largest educator-only pension fund in the world. CalSTRS administers a hybrid retirement system, consisting of traditional defined benefit, cash balance and voluntary defined contribution plans. CalSTRS also provides disability and survivor benefits. CalSTRS serves California's 868,000 public school educators and their families from the state’s 1,600 school districts, county offices of education and community college districts.
For more information about World Bank green bonds, see: http://treasury.worldbank.org/greenbonds.
