Washington, DC, March 3, 2015 - Today, the World Bank (International Bank for Reconstruction and Development, IBRD, rated Aaa/AAA), launched a CAD 1.2 billion 5-year fixed rate global bond. This is the World Bank’s largest CAD transaction to date. It follows the World Bank’s previous record-setting CAD 1 billion global bond in May 2014, which at the time was the largest single-tranche deal from a supranational issuer in that market.
The 5-year bond carries a semi-annual coupon of 1.125% and will mature on March 11, 2020. It offers a semi-annual yield of 1.178% which is equivalent to a spread of 39.7 basis points over the Canadian Government’s 1.50% March 2020 benchmark.
Based on strong investor interest, the transaction was upsized from initial expectations of a benchmark around Canadian Dollar 500 million. Central banks and official institutions led a well-diversified, high-quality orderbook with 40 orders from investors across the globe.
The joint lead managers for this offering were BMO Capital Markets and TD Securities.
“This is a great result. We are very pleased with the size and diversity of the orderbook, and grateful to investors for their support of the World Bank and our sustainable development mandate. We would like to thank the lead managers, BMO and TD, for their work on this transaction,” said Andrea Dore, Lead Financial Officer, Capital Markets, World Bank.
The bonds were placed with 40 institutional investors globally. The high-quality order book had a well-balanced investor distribution by region and type:
Investor Distribution | |||
By Geography | By Investor Type | ||
Asia | 39% | Central Banks / Official Institutions | 50% |
Americas | 26% | Banks / Corporates | 31% |
Europe | 21% | Asset Managers | 19% |
Other Americas | 10% |
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Middle East and Africa | 5% | ||
Transaction Summary:
Issuer: World Bank (International Bank for Reconstruction and Development, IBRD)
Issuer rating: Aaa/AAA
Amount: CAD 1.2 billion
Settlement date: March 11, 2015
Maturity date: March 11, 2020
Issue price: 99.743%
Coupon: 1.125% (semi-annual)
Denomination: CAD 1,000 and multiples thereof
Listing: Luxembourg Stock Exchange
Clearing system: CDS, Euroclear / Clearstream
Joint lead managers: BMO Capital Markets, TD Securities
Co-lead managers: Casgrain, CIBC, National Bank Financial Inc, RBC Capital Markets, Scotiabank
Joint Lead Manager Quotes:
“A fourth consecutive year in the Canadian Dollar benchmark market with yet another largest ever outcome speaks volumes to the World Bank’s ongoing development in the CAD space. The World Bank’s ability to respond quickly to investor demand helped build a high quality orderbook, allowing for the upsize to a C$1.2 billion print. Involvement from 40 accounts across the globe is a testament to World Bank’s ability to reach both long-time buyers, and new domestic investors in the Canadian market. We were pleased to be involved in this successful transaction, extending the World Bank Canadian Dollar benchmark curve,” said Scott Graham, Head of Public Sector New Issues, BMO Capital Markets.
“The World Bank has been absent from the CAD market since June of last year. There was clearly pent-up demand for the name and this resulted in their largest ever benchmark in this market to date. Demand for the deal was very diverse with the usual strong support from the central bank community. We were also very pleased with the domestic participation in the book. Overall this is an outstanding transaction,” said Salvatore Aloisi, Managing Director, Syndication & Origination, TD Securities.
The transaction is consistent with the World Bank’s longstanding practice of deploying its franchise as an issuer in the international capital markets to offer investor’s high-quality, liquid instruments. This approach has direct benefits for World Bank member countries as well, since as a cooperative institution it is able to fund its activities as a provider of financial services to its members on highly attractive terms.
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 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 sustainable development activities and achieve a positive impact. Information for investors is available on the World Bank Treasury website: (http://treasury.worldbank.org/capitalmarkets).
