WASHINGTON, DC November 3, 2016 - As of 12:01 a.m. Nov. 4, 2016, Washington D.C. time the fixed spread over LIBOR (or EURIBOR) will decrease for new IBRD Flexible Loans (IFLs) with maturities less than 8 years, greater than 8 up to 10 years, greater than 10 to 12 years, and greater than 12 up to 15 years. Fixed spreads for loans with average repayment maturities greater than 15 to 18 years and greater than 18 years will remain unchanged. The fixed spreads shown in the table below will apply to all fixed spread loans signed on or after Nov. 5, 2016, local time at the place of signing.
For IFL Fixed Spread Loans Signed On or After Nov 5, 2016 | ||||||
Average Repayment Maturity* (years) | Less than 8 Years* | Greater than 8 to 10 Years* | Greater than 10 to 12 Years* | Greater than 12 to 15 Years* | Greater than 15 to 18 Years* | Greater than 18 Years* |
Contractual Spread | +0.50% | +0.50% | +0.50% | +0.50% | +0.50% | +0.50% |
Maturity Premium | - | +0.10% | +0.20% | +0.30% | +0.40% | +0.50% |
Market Risk Premium | +0.10% | +0.10% | +0.10% | +0.10% | +0.15% | +0.15% |
Projected Funding Cost | +0.15% | +0.30% | +0.30% | +0.40% | +0.50% | +0.50% |
USD Lending Rate | LIBOR +0.75% | LIBOR +1.00% | LIBOR +1.10% | LIBOR +1.30% | LIBOR +1.55% | LIBOR +1.65% |
Change from Previous Pricing | -0.10% | -0.10% | -0.10% | -0.05% | unchanged | unchanged |
EUR Lending Rate** | Euribor +0.60% | Euribor +0.85% | Euribor +0.95% | Euribor +1.15% | Euribor +1.40% | Euribor +1.50% |
JPY Lending Rate** | LIBOR +0.40% | LIBOR +0.65% | LIBOR +0.75% | LIBOR +0.95% | LIBOR +1.20% | LIBOR +1.30% |
GBP Lending Rate** | LIBOR +0.70% | LIBOR +0.95% | LIBOR +1.05% | LIBOR +1.25% | LIBOR +1.50% | LIBOR +1.60% |
The decrease in the fixed spread is the result of a decrease in IBRD’s projected funding cost, which Bank management reviews at least quarterly to ensure that it reflects evolving, underlying market conditions.
** A basis swap adjustment of -0.15% is applicable to EUR fixed spread, -0.35% is applicable to the JPY fixed spread, and -0.05% is applicable to GBP fixed spread.
* As measured by average repayment maturity of the loan at commitment.
Please contact Miguel Navarro-Martin for more information.
