Washington DC, March 2, 2016 -The World Bank (IBRD, Aaa/AAA) today priced a USD 4 billion 5-year global benchmark that matures on March 9, 2021. With global markets offering some respite from the heightened volatility observed so far this year, the World Bank moved swiftly to take advantage of this relative stability by announcing a 5-year Global benchmark. The transaction builds on the positive sentiment for the World Bank credit following the 3-year Global priced in January this year, offering investors a new anchor reference point on the World Bank benchmark curve.
The orderbook closed in excess of USD 5.1 billion with over 100 accounts participating, enabling the World Bank to move inside of initial price guidance to price a USD 4 billion global benchmark.
Joint lead managers for this global bond are BMO Capital Markets, BNP Paribas, Citi and J.P. Morgan.
The 5-year benchmark has a semi-annual coupon of 1.625% and a maturity date of March 9, 2021. It offers investors a yield of 1.657% (semi-annual), equivalent to 30.62 basis points over the 1.125% UST due February 2021.
"We are delighted with the very warm reception by a broad range of investors across the globe. Orders exceeded our targeted transaction size by more than two and a half times demonstrating the value placed on the World Bank's solid credit and liquidity, especially during times of continued market volatility and uncertainty. We are pleased that we have been able to increase the size of the transaction to respond to this very strong demand. We are very grateful for the strong support from our investors and financial partners for our global sustainable development mandate," said Arunma Oteh, Vice President and Treasurer, World Bank.
Distribution by Geography
Distribution by Investor Type
Asia (ex. Japan)
Central Banks/Official Institutions
Banks / Corporates
Asset Managers/Insurance/Pension Funds
USD 4 billion
March 9, 2016
Coupon payment dates:
Paid semi-annually on 9 March and 9 September of each year
March 9, 2021
Luxembourg Stock Exchange
Fedwire, Euroclear, Clearstream
Joint lead managers:
BMO Capital Markets, BNP Paribas, Citi and J.P. Morgan
Joint lead manager quotes:
"The pricing outcome represented less than a basis point of new issue concession, an impressive achievement in light of a volatile backdrop and heightened primary market concessions throughout 2016 to-date. This was the World Bank’s first benchmark return to the 5 year maturity since 2014, and it showed as the transaction was able to reach new investors, with strong demand across the globe from long-standing buyers as well. BMO was pleased to be involved in this fantastic result for the World Bank.” said Scott Graham, Head of International Public Markets, BMO Capital Markets.
“The World Bank continues to receive the strongest support from the international Central Bank community. Garnering USD 5.1 billion of interest at a level representing the tightest new issue premium for a USD 4 billion benchmark in some time is testament to the perceived credit quality of the World Bank among the SSA investor community.” said Jamie Stirling, Head of SSA DCM, BNP Paribas.
“This has been another textbook execution from the World Bank. The orderbook reflects the popularity and benchmark status of IBRD dollar bonds, particularly with Central Banks and Bank Treasury portfolios across the globe.” said Philip Brown, Head of SSA Origination, Citi.
“World Bank proves that absence makes the heart grow fonder, as over 100 investors jumped into the issuer's first offering in the 5-year USD space in 18 months. The deal priced competitively while still garnering a truly global distribution. A textbook World Bank deal.” said John Lee-Tin Jr, Head of Frequent Borrower DCM, J.P. Morgan.
The present 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 and the original member of the World Bank Group. 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 Group has two main goals: to end extreme poverty and promote shared prosperity. The World Bank (IBRD) seeks to achieve them primarily by providing loans, risk management products, and expertise on development-related disciplines to its borrowing member government clients in middle-income countries and other creditworthy countries, and by coordinating responses to regional and global challenges. The World Bank has been issuing sustainable development bonds in the international capital markets for over 60 years to fund its activities and achieve a positive impact. Information on bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities.