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Speeches & Transcripts April 17, 2018

Arunma Oteh's Remarks at Inaugural IDA Bond Pricing Event

Distinguished ladies and gentlemen, welcome to the pricing event for IDA’s inaugural bond.  This debut bond makes history for us at the World Bank and for development finance.

We are grateful that IDA’s task team leader and World Bank Group President is here today, Welcome Jim.

Let me also specially welcome our Ministers of Finance, Central Bank Governors, IDA Deputies, Board members, Kristalina, Joaquim, Shaolin, teams from other MDBs, and former Treasurers who are also here with us.  

IDA would not be here today without your support, your hard work, your trust and confidence, as well as the support from IDA donors and client countries. 

For nearly sixty years we have worked together to help the world’s poorest countries.  Today, the capital markets have joined us in this important effort.

This new IDA model sets the standard for others to emulate.

It is also a concrete step towards maximizing finance for development bringing us closer to achieving our goal of eradicating extreme poverty.  

IDA’s journey to the capital markets started long before today.

It started when IDA was created in 1960 to focus on the poorest countries and contribute to them becoming the fastest-growing economies in the world.

IDA’s mission remains compelling and our donors are committed to IDA as evidenced through the successive replenishments that IDA has relied on since 1964. 

There is still much to be done for us to realize the Sustainable Development Goals and eradicate extreme poverty.  

Entering the capital markets is an innovation that allows us to do so as it expands IDA’s lending capacity by 50%.

To take IDA to the capital markets, we first had to introduce IDA to investors as only a few had heard of it as recently as last year. 

We therefore, have spent months introducing IDA to prospective investors highlighting:

its strong capital position of $160 billion dollars, its history of strong donor support, the strong track record of repayments by client countries, its prudent financial and operational management, and its strong governance and oversight.

Today, all of these efforts have yielded excellent fruit.

Our target transaction size for IDA’s first bond was $1 billion dollars, but we received orders of $4.6 billion dollars from 110 investors in 30 countries. George will explain how we managed the 4.6 times oversubscription including by increasing the deal size to $1.5 billion.

This exceptional demand demonstrates that investors recognize IDA not only as an outstanding triple-A credit, but also an opportunity to “do good, while doing well”.  

IDA’s value proposition is particularly powerful because investors can earn a reasonable return while connecting to a noble purpose.

The success of this transaction is a phenomenal testimony to the work that has been done to position IDA.

To colleagues in DFI, CRO, WFA, Legal and Information Technology, and to those in operations, IFC and MIGA, thank you for your hard work.

Thank you also to my World Bank Treasury colleagues for the advisory services you provide to IDA clients, for implementing IDA’s asset and liability management transactions, and for being an able custodian of IDA’s $30 billion dollars of liquidity - all of which are important factors in IDA’s Triple A rating.

And, of course, to my colleagues in the Capital Markets Department.  I challenged you to make sure that we were the best at guiding IDA’s entry into the capital markets and you did this with passion, dedication and commitment.  Thank you.

To our IDA Deputies, Board Members, Jim, Kristalina, Joaquim, Shaolin, thank you for your leadership.

This historic moment is further evidence of the unique role that the World Bank Group plays in development, using innovation to tackle the most difficult challenges in the world.

To each and every one of you here today, thank you for your support.