Washington, DC, February 13, 2020 – The World Bank (IBRD, Aaa/AAA) priced a 10-year Euro-denominated global benchmark bond, raising EUR 2.5 billion from institutional investors around the globe, to support the financing of its sustainable development activities. This is the World Bank’s second EUR global bond of 2020, following its EUR 3 billion 7-year global bond issued in January.
The transaction represents World Bank’s largest 10-year Euro-denominated benchmark in over a decade, and the first negative-yielding 10-year Euro benchmark from a supranational issuer this year. Barclays, DZ BANK, J.P. Morgan, and Société Générale are the lead managers for the transaction. The bond will be listed on the Luxemburg Stock Exchange.
The EUR 2.5 billion bond was well oversubscribed, with an orderbook reaching EUR 3.7 billion. The bond priced with a final spread to mid-swaps of -6 basis points, 1 basis point tighter than initial guidance and equivalent to a yield of -0.10%. This equates to a spread vs. the reference Bund of +29.5 basis points.
"We are very grateful to investors for their strong demand for one of the World Bank’s largest EUR bonds. This milestone transaction is a remarkable sign of support in the World Bank’s mission to end extreme poverty and promote shared prosperity in our member countries”, said Jingdong Hua, Vice President and Treasurer, World Bank
By Investor Type
Asset Managers/Insurance/Pension Funds
Central Banks/Official Institutions
Joint Lead Manager Quotes
“It has been a pleasure to watch the World Bank continue to develop its presence in the Euro market, and today’s remarkable transaction was yet another step in that regard. Following on from the issuer’s EUR 1.5 billion 10-year Sustainable Development Bond last May and their EUR 3 billion 7-year benchmark this past January, this hugely successful benchmark adds yet another liquid point to World Bank’s EUR curve and refreshes the all-important 10-year benchmark reference, garnering upwards of EUR 3.7 billion in orders. As always, it is a privilege for Barclays to have worked on this spectacular transaction with World Bank,” said Lee Cumbes, Head of Public Sector EMEA, Barclays.
“The World Bank was spot on with its 10-year EUR offering, showing their leadership in the capital markets. The transaction demonstrates, with over 110 orders, the outstanding access to the broadest range of investors the World Bank has, in all currency markets, at all times. DZ BANK is very proud to support the World Bank and its outstanding treasury team with their task to end extreme poverty and promote shared prosperity in a sustainable manner,” said Wolfgang Köhler, Board of Managing Directors Member, DCM, DZ BANK.
“The World Bank is visibly expanding its presence in the Euro market this year and in turn being met with strong international reception, having returned for the second time in 2020 with its largest 10-year Euro benchmark in over a decade. The EUR 2.5 billion transaction was the first benchmark-sized supranational 10-year bond to price at a negative yield, achieving solid size and quality despite a more challenging global rates backdrop upon book opening. J.P. Morgan is honored to have been involved in this remarkable EUR trade as well as World Bank’s very successful GBP benchmark in the same tenor, both executed seamlessly side-by-side by the World Bank Treasury team,” said Keith Price, Managing Director, Head of Frequent Borrowers Group, J.P. Morgan.
“Once again, The World Bank led the way, this time, by completing this successful double issuance. With a Euro 2.5 billion 10-year Euro benchmark the World Bank demonstrates the strong appetite of international investors for its high-quality signature. What is even more remarkable, is that they achieved this strong result while offering a negative yield at 10-year, a first for a supranational this year in Euros,” said Olivier Vion, Managing Director, Head of DCM and Syndicate SSA.
World Bank (International Bank for Reconstruction and Development, IBRD)
21 February 2020
21 February 2030
Luxembourg Stock Exchange
Euroclear, Clearstream, Luxembourg
Joint lead managers:
Barclays, DZ BANK, J.P. Morgan Securities, Societe Generale
With annual issuances between US$50-US$60 billion, World Bank bonds support the financing of programs that support the Sustainable Development Goals. World Bank bonds are aligned with the sustainability bond guidelines published by the International Capital Markets Association (ICMA). The World Bank is also a member of the Executive Committee of the Green Bond and Social Bond Principles. A key priority for the World Bank’s capital markets’ engagement is building strategic partnerships with investors to promote the importance of private sector financing in sustainable development.
This press release is not an offer for sale of securities of the International Bank for Reconstruction and Development ("IBRD"), also known in the capital markets as "World Bank". Any offering of World Bank securities will take place solely on the basis of the relevant offering documentation including, but not limited to, the prospectus, term sheet and/or final terms, as applicable, prepared by the World Bank or on behalf of the World Bank, and is subject to restrictions under the laws of several countries. World Bank securities may not be offered or sold except in compliance with all such laws.
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 is the original member of the World Bank Group and operates as a global development cooperative owned by 189 nations. The World Bank provides loans, guarantees, risk management products, and advisory services to middle-income and other creditworthy countries to support the Sustainable Development Goals and to end extreme poverty and promote shared prosperity. It also provides leadership to coordinate regional and global responses to development challenges. The World Bank has been issuing sustainable development bonds in the international capital markets for over 70 years to fund programs and activities that achieve a positive impact. More information on World Bank bonds is available at www.worldbank.org/debtsecurities.
Heike Reichelt, Head of Investor Relations and New Products, World Bank Treasury