WASHINGTON, DC, January 18, 2023 – The World Bank (International Bank for Reconstruction and Development, IBRD rated Aaa/AAA) has priced a New Zealand dollar 550 million 5-year 4.625% fixed-rate bond due February 2, 2028. The benchmark bond was launched with an initial minimum target size of NZD 300 million and was increased due to strong investor demand.
The deal priced at 99.801389% to yield 4.67% p.a. semi-annual. This equates to a spread of 54.5 basis points over the New Zealand Government Bond due May 15, 2028.
The joint-lead managers for the transaction are Bank of New Zealand, Commonwealth Bank of Australia, The Toronto-Dominion Bank.
“We are extremely appreciative of New Zealand dollar investors that supported today’s Kauri issuance,” said Andrea Dore, Head of Funding, World Bank. “Funding from diverse global investor groups and various currencies and countries helps the World Bank to efficiently support its member countries.”
Investor Distribution
By Geography | By Investor Type | |||
New Zealand | 84% |
| Banks/Bank Treasuries | 87% |
Asia | 15% |
| Asset Managers/Insurance/Pension Funds | 13% |
Others | 1% |
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Joint Lead Manager Quotes
“This transaction marked a successful return to the Kauri market by the World Bank as it delivered the first 5-year issue in 2023, and BNZ were delighted to be involved. It was pleasing to see this tenor engage to a diverse range of investors, reflective of the strong support that the World Bank has developed in the investor community through regular ongoing issuance in the Kauri market over the years. Congratulations!” said Mike Faville, Head of Capital Markets, BNZ.
“Congratulations to the World Bank team on another well-timed transaction in the Kauri market. The strength of the World Bank name continues to attract broad reception across the New Zealand dollar investor base as reflected by demand from both onshore and offshore. CBA is delighted to have partnered alongside the World Bank team to support its overarching mission towards financing sustainable development, projects, programs and activities in its member countries,” said Danny Keene, Director – Debt Capital Markets, Commonwealth Bank of Australia.
“A very successful trade from the World Bank team in New Zealand dollar market today, printing a first 5- year benchmark of 2023. Kauri investors continue to reward the World Bank for its longstanding presence and strategic approach to the market. The deal received strong investor take up and a high quality orderbook, allowing to upsize the transaction to New Zealand dollar 550 million. Well thought out strategy and swift execution played a crucial role in today's success. TD Securities is honored to have been entrusted to work on such an important mandate and we are excited for continued partnership in the future,” said Yuriy Popovych, Director, Fixed Income Syndicate, TD Securities.
Transaction Summary*
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
Issuer rating: | Aaa/AAA |
Amount: | NZD 550,000,000 |
Settlement date: | February 2, 2023 |
Minimum Subscription: | NZD 1,000 (within New Zealand, NZD 100,000) |
Minimum denominations and minimum holding: | NZD 1,000 and multiples thereof (within New Zealand, NZD 100,000 with multiples of NZD 1,000 thereafter) |
Format: | Registered notes |
Coupon: | 4.625% per annum, payable semi-annually |
Maturity date: | February 2, 2028 |
Re-offer price: | 99.801389% |
Re-offer yield: | 4.67% p.a. semi-annual |
Listing: | Luxembourg Stock Exchange |
Clearing systems: | NZ Clear |
ISIN: | NZIBDDT021C7 |
Joint lead managers: | Bank of New Zealand, Commonwealth Bank of Australia, The Toronto-Dominion Bank |
*On August 7, 2023, IBRD agreed to increase the principal amount of the bond with a tap in the amount of NZD 500 million with an issue price of 99.669% (settlement date: August 17, 2023). The new total outstanding principal amount is NZD 1.05 billion.
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.
World Bank bonds support the financing of programs that further the Sustainable Development Goals (SDGs). World Bank bonds are aligned with the Sustainability Bond Guidelines published by the International Capital Market Association and as such support the financing of a combination of green and social, i.e., “sustainable development” projects, programs and activities in IBRD member countries as described in the World Bank Sustainable Development Bond Framework. The World Bank is also a member of the Executive Committee of the Green Bond, Social Bond, and Sustainability 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. The World Bank’s Sustainable Development Bond Impact Report describes how the World Bank engages with investors on the SDGs and raises awareness for specific development challenges.
Disclaimers
Net proceeds of the bonds described herein are not committed or earmarked for lending to, or financing of, any particular projects or programs, and returns on the bonds described herein are not linked to the performance of any particular project or program.
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, including under the laws of New Zealand. World Bank securities may not be offered or sold except in compliance with all such laws. The World Bank Sustainable Development Bond Framework, the World Bank’s Sustainable Development Bond Impact Report, and the information set forth therein are not a part of, or incorporated by reference into, the offering documentation.
Contact
Heike Reichelt, Head of Investor Relations and Sustainable Finance
World Bank Treasury
debtsecurities@worldbank.org
