PRESS RELEASE October 9, 2019

IDA Makes its Successful Debut in Euro with a EUR 1.25 Billion 7-year Benchmark Bond

Washington, DC, October 9th, 2019 – The International Development Association (IDA, Aaa/AAA) today priced its inaugural Euro-denominated benchmark bond in the market, a milestone in the institution’s long-term strategy of building a diversified funding program with a focus on the SDR currencies. It is a EUR 1.25 billion benchmark bond with a maturity of 7 years.

The transaction was announced during the European morning on October 8th, with formal bookbuilding commencing the following day and reaching over EUR 1.8 billion. The transaction was upsized to EUR 1.25 billion to accommodate the high-quality and diverse order book.

The transaction was priced with a final spread of 36.8 basis points over the DBR 0% August 2026 reference Bund, equivalent to mid-swaps minus 6 basis points. With an annual yield of -0.369%, this is the first EUR benchmark from a non-European supranational issuer to price at a negative yield.

Credit Agricole, DZ Bank, J.P. Morgan and Natixis are the joint lead managers for the transaction.

Anshula Kant, newly appointed Managing Director and World Bank Group Chief Financial Officer, said “We are very pleased with the positive reception IDA received today with its debut bond in Euro.  IDA’s proposition to investors is unique: a safe investment that impacts so many people around the world in a positive way.  The additional resources borrowed from the bond markets coupled with the unparalleled, ongoing support it receives from its donor nations, enables IDA to optimize the impact value of its capital for all its shareholders, while at the same time furthering IDA’s role in attaining the Sustainable Development Goals.”

Jingdong Hua, Vice President and Treasurer, World Bank, said: “After IDA’s inaugural US$ benchmark last year and the launch of the bills program earlier this year, we are very excited to bring to the markets another opportunity to support development in the areas of the world that need it most. IDA’s successful Euro debut represents another critical step in establishing IDA as a premier issuer in the international capital markets alongside IBRD, with its own, unique and diversified credit and mission. With more issuance to come, we look forward to consolidating our ‘impact investing’ partnership with investors and intermediaries.”

Investor Distribution

By Geography

By Investor Type

Europe

78%

Banks/Bank Treasuries/Corporates

42%

Asia

14%

Central Banks/Official Institutions

40%

Americas

8%

Asset Managers/Insurance/Pension Funds

18%

 

Philippe Brassac, CEO of Crédit Agricole S.A. and Chairman of CA-CIB, said “Today’s emblematic benchmark issue has added Europe to the wider global community of investors committed to support IDA in its mandate of sustainable development and the eradication of extreme poverty. Issuing on the capital markets allows IDA to extend its resources beyond the capital contributions from its member countries, in order to achieve faster its long-term goals. With over 40 investors involved in this landmark transaction, IDA has proven its global reach amongst the largest and most sophisticated investors from across regions. CACIB is very proud to have contributed to IDA’s historical debut into the EUR market”.

Wolfgang Köhler, Member of the Board of Managing Directors, DZ Bank, said “IDA is an extremely important and powerful tool for its 173 shareholder countries to fight extreme poverty and promote shared prosperity in a sustainable way. With its newly established financial policies and expanded range of products IDA is playing a crucial role within the World Bank Group supporting 73 countries by financing programs that improve living conditions and help ending extreme poverty. Congratulations to the World Bank Treasury team, which structured and executed today’s highly successful inaugural EURO bond issue building on its rich experience with outstanding capital markets transactions. DZ Bank as an institution that firmly roots in the cooperative and sustainable financial sector is proud to have been chosen to support IDA in this exceptional bond issue”.

Daniel Zelikow, Vice Chairman, Public Sector, J.P. Morgan, said “Today’s EUR transaction marks another key milestone in the build-out of IDA’s funding program and furthers the effort in helping IDA countries achieve the Sustainable Development Goals by 2030. We look forward to continued partnership with the World Bank as they tackle the most pressing development challenges.”

François Riahi, Chief Executive Officer, Natixis, said “Natixis is honored to jointly lead this EUR-denominated debut bond issue and sincerely congratulates the IDA team. This is a remarkable moment for IDA, as it diversifies its investor base in order to continue to support the world’s poorest countries. The values of IDA deeply resonate with us here at Natixis as they echo the very ideals we are striving to achieve in our business, with a focus on promoting sustainable and socially responsible finance. The Natixis team is proud to partner alongside IDA to achieve this objective and create a positive global impact”.

Transaction Summary

Issuer:

International Development Association (IDA)

Issuer rating:

Aaa/AAA

Amount:

EUR 1.25 billion

Format:

Reg S

Settlement date:

October 17, 2019

Maturity date:

October 19, 2026

Issue price:

102.624%

Issue yield:

-0.369% annual

Coupon:

0% p.a.

Denomination:

EUR 1,000

Listing:

Luxembourg Stock Exchange

Lead managers:

Credit Agricole, DZ Bank, J.P. Morgan, Natixis

Senior co-leads:

Commerzbank, HSBC, Natwest Markets, SEB

ISIN:

XS2066003901


This press release does not constitute or form part of and should not be construed as an offer for sale or issue or the solicitation of an offer to buy or acquire the securities described in any jurisdiction or an inducement to enter into investment activity. No part of this press release, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The offering and sale of the securities described in this document are subject to restrictions under the laws of several jurisdictions. Securities may not be offered or sold except in compliance with all such laws.

About IDA

The International Development Association (IDA), rated Aaa/P-1 and AAA/A-1+ (Moody’s/S&P), is one of the largest sources of funding for the world’s poorest countries. Established in 1960 and overseen by 173 shareholder nations, IDA has supported development work in 113 countries. Annual commitments have averaged about USD 18 billion over the last three years. Proceeds of IDA bonds support sustainable development projects and programs in IDA’s eligible member countries. Projects and programs supported by IDA are designed to achieve a positive social impact and undergo a rigorous review and internal approval process aimed at safeguarding equitable and sustainable economic growth. Information on IDA bonds are available at http://www.worldbank.org/en/about/unit/treasury/ida.

Contact

Heike Reichelt
Head of Investor Relations and New Products
The World Bank
+1 202 477 2880
debtsecurities@worldbank.org


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