The World Bank (WB) has raised funds by issuing bonds in three different currencies namely Canadian dollars (CAD), Australian dollars(AUD), and United States Dollars (USD) to support the financing of green and social projects, programs and activities in the member countries.
- World Bank’s arm International Bank for Reconstruction and Development (IBRD) acts as the issuer.
Launched Bonds:
i.5-year AUD Sustainable Development Bond – AUD 2 billion
ii.7-Year USD Sustainable Development Bond – USD 5 billion
iii.5-year CAD Sustainable Development Bond – CAD 1.4 billion
Note: These bonds are listed on the Luxembourg Stock Exchange (LSE) in Luxembourg City, Luxembourg; All the bonds are rated as Aaa/AAA.
5-year AUD Sustainable Development Bond:
i.The World Bank has launched a 5-year bond with the value of AUD 2 billion which will be maturing on 10th January 2029.
ii.It was the first benchmark transaction as it achieved a transaction size of AUD 2 billion which is the largest AUD Sovereign, Supranational and Agency (SSA) transaction.
About the bond:
i.The bond is of Minimum denomination AUD 1,000 and the minimum holding is fixed at AUD 500,000.
ii.Re-offer price of the bond is 99.878% and the Re-offer yield is 4.3275% (semi-annual).
iii.The Joint lead managers of the transaction are Deutsche Bank AG, JP Morgan, Nomura International plc, and Royal Bank of Canada (RBC) Capital Markets.
Investor Distributions:
- By Type- Banks/Bank Treasuries (38%), Central Banks / Official Institutions (37%), Asset Managers /Insurance/Pension Funds (25%).
- By Region- Asia(56%), Australia (22%), Europe, Middle East, and Africa (EMEA – 22%).
7-Year USD Sustainable Development Bond:
WB has launched a 7-year bond valuing USD 5 billion from investors and this transaction is the first in SSA market in 2024 to generate the largest order book.
About the bond:
i.This high-quality liquid bond matures on 10th January 2031.
ii.The denomination of the bond is USD 1,000 and the Coupon rate is fixed at 4.00% which is paid semi-annually.
iii.Issue price of the bond is 99.505% and the Issue yield 4.082% (semi-annual).
iv.Lead managers of the transactions are Barclays Bank PLC, BMO Capital Markets, BNP Paribas, and Citigroup Global Markets.
Investor Breakdown:
- By Type – Banks/Bank Treasuries/Corporates (49%), Central Banks/Official Institutions (35%), Asset Managers /Insurance/Pension Funds (16%)
- By Geography- Europe / Middle East/ Africa (EMEA -56%), USA (26%), Asia (18%)
5-year CAD Sustainable Development Bond:
The World Bank has launched a 5-year bond valued at CAD 1.4 billion to finance sustainable development initiatives in IBRD member countries.
- The bond is set to mature on 12th January 2029.
About the bond:
i.The bond is issued at a price of 99.678% and the investors are offered a yield of 3.571% (semi-annual).
ii.Canadian Imperial Bank of Commerce (CIBC), Royal Bank of Canada (RBC) Capital Markets, National Bank Financial, and Toronto Dominion Securities are the joint lead managers.
iii.The denomination of the bond is CAD 1,000.
Investor Distributions:
- By Type- Central Banks/Official (55%), Banks/Bank Treasuries/Corporates (34%), Asset Managers /Insurance/Pension Funds (11%).
- By Region- Americas (48%), Asia (34%), Europe/Middle East/Africa (18%).
Recent Related News:
According to India Development Update(IDU) October 2023 released by the World Bank(WB), India’s Gross Domestic Products (GDP) growth for the Financial Year 2023-24 (FY23/24) is retained at 6.3% and for FY24/25 the growth rate will be at 6.4%.
About World Bank:
World Bank Group President – Ajay Banga
Headquarters – Washington DC, United States of America (USA)
Established in – 1944
