Washington, D.C., May 7, 2020 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) today priced a USD 4 billion 10-year global benchmark bond that matures on May 14, 2030.
Strong demand from global investors for the USD benchmark led to an orderbook of USD 5.6 billion, with over 130 investor orders, anchored by central banks and official institutions. Other investors included bank treasuries, asset managers, as well as pension and insurance funds.
The 10-year benchmark pays a semi-annual coupon of 0.875% and has an issue price of 99.428%. It has a final spread of 31.45bps over the 1.50% US Treasury due February 15, 2030 reference bond, offering investors a yield of 0.935%. Joint lead managers for this transaction are BofA Securities, J.P. Morgan, Nomura and RBC Capital Markets.
“We appreciate the continued investor support for the World Bank and our development mandate. It allows us to serve our member countries, helping them safeguard their progress towards sustainable development - especially through this challenging period,” said Jingdong Hua, Vice President and Treasurer, World Bank. “This transaction is part of the World Bank’s issuance program, which raises funds to support projects and programs, including those providing immediate health responses and other projects directed to contain the impact of COVID-19.”
By Investor Type
Central Banks/Official Institutions
Asset Managers/Insurance/Pension Funds
“Another fantastic transaction by the World Bank, met once again by strong demand from over 130 accounts across geographies. A solid orderbook enabled the World Bank to print the first 10-year Sovereign, Supranational and Agency (SSA) trade in almost 4 months, while highlighting its ongoing support to developing countries. Congratulations to the whole team,” said Adrien de Naurois, Head of EMEA IG Syndicate & DCM SSA at BofA Securities
“The World Bank reopens the 10-year maturity in style, with a USD 4 billion Sustainable Development Bond on the back of a USD 5.6 billion orderbook. The issuer took advantage of the consistently improving market sentiment to launch the first 10-year USD SSA benchmark since January. Despite outright yields at such low levels, the trade became the largest 10-year benchmark in the USD SSA space since 2014, thanks to strong and widespread support from IBRD’s global investor base, topping 130+ orders. A timely move to tap into pent-up demand for duration, and another very successful funding exercise for the World Bank Treasury team!” said Keith Price, Head of Frequent Borrower Group, J.P. Morgan
“Once again the World Bank has demonstrated clear market leadership with a hugely successful 10-year Sustainable Development Bond. The transaction marks only the second 10-year SSA trade this year and will provide the market with the confidence that this sector of the curve is truly open despite the new yield environment. With over 130 investors participating, this transaction is a testament to World Bank’s global appeal and that its mandate clearly resonates with investors,” said Spencer Dove, Head of SSA DCM at Nomura
“The World Bank has always been at the forefront when it comes to helping its member countries cope with challenges and few can match the speed of their response to the COVID-19 pandemic. A USD 4 billion 10-year bond is a spectacular result in any market, and the success of this transaction once again highlights World Bank’s very special global franchise. It is particularly gratifying to see the market uniting to support Good Health and Wellbeing goals at this critical juncture, and we at RBC were honored to be part of this very important transaction," said Jigme Shingsar, Managing Director, RBC Capital Markets
World Bank (International Bank for Reconstruction and Development, IBRD)
Aaa / AAA (stable / stable)
May 14, 2020
May 14, 2030
Luxembourg Stock Exchange
BofA Securities, J.P. Morgan, Nomura, RBC Capital Markets
Senior co-lead managers:
BMO Capital Markets, Deutsche Bank, Morgan Stanley, Wells Fargo
With annual issuances on average between USD 55-USD 65 billion, World Bank bonds support the financing of programs that further 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 for sustainable development.
For more information on the World Bank Group and COVID-19
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.
The net proceeds from the sale of World Bank securities are used to finance sustainable development projects and programs in World Bank’s member countries without being committed or earmarked for lending to, or financing of, any particular projects or programs. Returns on World Bank securities are not linked to the performance of any particular project or program.
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 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 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 bonds in the international capital markets for over 70 years to fund its sustainable development activities and achieve a positive impact. Information on bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities.
Heike Reichelt, The World Bank
+1 202 477 2880