Washington, DC, April 7, 2017 – The World Bank (International Bank for Reconstruction and Development, IBRD) has issued green bonds that bring its overall green bond program above $10 billion. The bonds raised $350 million from Folksam, a Swedishinsurance company, through two issuances that were customized to meet Folksam’s investment needs.
The World Bank has been a pioneer in developing the green bond market, issuing more than 130 green bonds in 18 currencies since 2008. The latest green bond issuances bring to $10.05 billion the overall funding it has raised from the capital markets for climate investments in developing countries. The World Bank has also led efforts to harmonize the market and bring greater transparency and clarity to issuers and investors, setting best market practice for reporting on the use of green bond proceeds through its green bond impact reports.
Arunma Oteh, World Bank Vice President and Treasurer, said: “We are delighted that this transaction has enabled us to reach an important milestone—$10 billion in bonds issued through our green bond program. We are excited about the future, as we continue to establish close partnerships with new investors and connect further the capital markets with solutions to address climate change, health, infrastructure and other development goals.”
The Folksam Group plans to expand its investments in bonds that support environmental and social goals.
“Our engagement in green bonds benefit our customers directly, as their money contributes to environment- and climate-friendly projects, while they generate safe returns. Our investments in green bonds show how we can add real value and live according to Folksam's vision,” said Jens Henriksson, Folksam Group President and CEO.
SEB is the lead manager for the bonds.
“Working with investors and the World Bank we are learning how the finance community can help address global development priorities. Folksam’s investment in World Bank bonds shows the role that investors can play in achieving a more inclusive financial sector,” said Christopher Flensburg, SEB Head of Climate and Sustainable Finance, SEB.
The World Bank raises around $50-60 billion a year by issuing bonds in the global capital markets. All proceeds from World Bank bonds serve the goals of eradicating extreme poverty and boosting shared prosperity by supporting development activities that are aligned with the Sustainable Development Goals. The Sustainable Development Goals are a set of 17 goals covering a broad range of sustainable development issues agreed upon by the global development community.
In addition to raising funding, the World Bank uses its bond issuances to raise market awareness for priority issues such as climate finance, health, and education, and to offer investors a framework for aligning their assets with investments that improve development outcomes.
Most recently, to raise awareness for the Sustainable Development Goals and the need to engage the private sector to overcome global development challenges, the World Bank issued bonds linked to an equity index of companies that support the Sustainable Development Goals.
Summary terms and conditions: | |||
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) | ||
Issuer rating: | Aaa /AAA | ||
Amount: | USD 300 million | USD 50 million | |
Issuance date: | April 12, 2017 | April 12, 2017 | |
Maturity date: | April 12, 2025 | April 12, 2020 | |
Coupon: | 2.00% p.a | USD 3m Libor +1 bps | |
Coupon payment dates: | Semi-annually, October 12 and April 12 in each year, from and including October 12, 2017, to and including the maturity date | Quarterly, January 12, April 12, July 12 and October 12 in each year, from and including July 12, 2017, to including the maturity date. | |
Issue price: | 99.943% | 100.00% | |
Listing: | Luxembourg Stock Exchange | ||
Clearing systems: | DTC, Euroclear, Clearstream | ||
ISIN: | US45905UG408 | US45905UG572 | |
Dealer: | Skandinaviska Enskilda Banken | ||
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 189 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 to its borrowing member government clients in middle-income countries and other creditworthy countries, 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 World Bank bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities
