WASHINGTON, D.C., April 4, 2023 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) today priced a 5-year benchmark bond that matures in July 2028. The Sustainable Development Bond raised USD 5 billion to support the World Bank’s work in developing countries to eradicate extreme poverty and boost shared prosperity in a sustainable manner.
The USD 5 billion transaction size matches the largest in the US dollar Sovereign, Supranational and Agency (SSA) market in 2023 and attracted nearly 150 orders totaling more than USD 8.2 billion appealing to investors seeking high credit quality and a liquid investment. The transaction benefited from the World Bank’s track record as a global issuer with a 75-year history of conservative financial and risk policies, solid capital structure, and high levels of liquid assets.
Citigroup Global Markets Limited, RBC Capital Markets, LLC, The Toronto-Dominion Bank, and Wells Fargo Securities, LLC are the lead managers. The bond, which will be listed on the Luxembourg Stock Exchange, offers a spread versus mid-swaps of +37 basis points, equivalent to +13.25 basis points versus the reference US Treasury, and has a semi-annual yield of 3.536%.
“The World Bank’s strength as a triple-A issuer is especially important in challenging markets,” said Jorge Familiar Vice President and Treasurer, World Bank. “The transaction benefited from the loyalty of a globally diverse investors base looking for safe and liquid assets and keen to support the World Bank’s efforts to secure sustainable, resilient and inclusive development for its member countries.”
Investor Distribution
By Geography | By Investor Type | ||
Europe/ Middle East/ Africa | 43% | Banks/Bank Treasuries/Corporates | 43% |
Americas | 39% | Central Banks/Official Institutions | 40% |
Asia | 18% | Asset Managers/Insurance/Pension Funds | 17% |
Lead Manager Quotes
“Congratulations to the World Bank on an excellent outcome for their second fixed-rate US dollar benchmark of the 2023 calendar year. The final orderbook of USD 8.2 billion was dominated by high quality and geographically diverse demand from investors, including bank treasuries, central banks, and asset managers. This is once again testament to the appeal of the World Bank credit to global fixed income investors, and to their support for the World Bank’s work to achieve the Sustainable Development Goals,” said Ebba Wexler – Head of Global SAS DCM, Citi.
“The World Bank’s successful return to the USD benchmark market was the balance of liquidity, maturity and credit quality needed to reopen the market. The final size and the extremely high quality of the orderbook reflected investors natural tendency to favor the top-quality credits during periods of uncertainty. The World Bank team is to be congratulated for their ongoing investor development efforts that has culminated in yet another perfectly timed transaction, “said Jigme Shingsar Managing Director, Debt Capital Markets, RBC.
"We congratulate the World Bank team for demonstrating remarkable agility following an extended period of market volatility. The strategic approach and diligent preparation for this long 5-year USD Sustainable Development Bond was rewarded with a high quality orderbook. The robust investor demand comfortably allowed for a successful USD 5 billion deal size and TD is honored to be involved in this stellar transaction from the World Bank", said Laura O'Connor, Managing Director & Head of UK DCM, TD Securities.
“The market got what it needed, a high-quality, liquid and well-known name to reopen the primary space after recent financial volatility. The result, a solid transaction with an oversubscribed book and tighter pricing than initial pricing thoughts. The World Bank proves again it is the prime issuer in the benchmark market with this USD 5 billion long 5-year Sustainable Development Bond, the second USD 5 billion transaction achieved this calendar year. Congratulations to the World Bank team!” said Carlos Perezgrovas, Head SSA Origination, Wells Fargo Securities.
Transaction Summary
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
Issuer rating: | Aaa /AAA |
Amount: | USD 5 billion |
Settlement date: | April 12, 2023 |
Maturity date: | July 12, 2028 |
Issue price: | 99.833% |
Issue yield: | 3.536% semi-annual |
Denomination: | USD 1,000 |
Coupon: | 3.50% p.a., payable semi-annually in arrear |
ISIN: | US459058KT95 |
Listing: | Luxembourg Stock Exchange |
Clearing system: | Fedwire, Clearstream, Euroclear |
Lead managers: | Citigroup Global Markets Limited, RBC Capital Markets, LLC, The Toronto-Dominion Bank, Wells Fargo Securities, LLC |
Senior co-lead managers: | CastleOak Securities, L.P., Daiwa Capital Markets, National bank of Canada financial Inc., Scotiabank Europe plc |
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. 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
Investor Relations and Sustainable Finance
World Bank Treasury
debtsecurities@worldbank.org
