WASHINGTON: The World Bank has priced a 5-year benchmark bond that matures in October 2029 and it raised $5 billion from global investors to support the World Bank’s work for sustainable solutions that reduce poverty and build shared prosperity in developing countries.
The Sustainable Development Bond attracted over $11 billion in orders through 175 high-quality orders led by bank treasuries, closely followed by official institutions and asset managers. Investors focused on the World Bank’s triple-A credit quality, the liquidity the bond offers, and the sustainable development use of funds.
The lead managers are Deutsche Bank AG, Goldman Sachs International, J.P. Morgan Securities, and The Toronto-Dominion Bank. The bond will be listed on the Luxembourg Stock Exchange, offers a spread versus the reference US Treasury of +8.7 basis points and has a semi-annual yield of 3.933%.
“The World Bank finances its sustainable development activities from borrowings like this USD 5 billion benchmark, and by leveraging equity from its members,” said Jorge Familiar Vice President and Treasurer, the World Bank.
“The strong reception, as evidenced by wide the oversubscription with over USD 11 billion in orders, demonstrates the importance of our strategy to bring to market high quality, liquid bonds in a variety of currencies and maturities.”
“The World Bank carefully chose its launch window to return to US dollars in the 5-year tenor, capitalizing on the higher yield environment after the supportive US labour market report and the ongoing strong bid for USD Sovereign, Supranational and Agency (SSA) bonds. The transaction attracted top-quality orders and resulted in very wide distribution to a variety of accounts globally. Deutsche Bank is proud to have supported as a lead manager,” said Katrin Wehle, Head of SSA DCM, Deutsche Bank.
“Congratulations to the World Bank team on the extremely successful USD 5-year global benchmark transaction. The World Bank continues to enjoy robust support from their global investor base as highlighted by a diverse orderbook with top-notch quality. Goldman Sachs is delighted to have been a part of this landmark transaction and to support the World Bank’s sustainable development mandate,” said Dorothee Amar, Co-head of SSA, Goldman Sachs.
“Today’s 5-year USD benchmark from the World Bank highlights the issuer’s strong market presence with an orderbook of USD 11.1 billion which is only behind its record-setting April 2020 USD 8 billion 5-year transaction orderbook. With 175 orders, IBRD continues to enjoy one of the broadest USD investor bases in the SSA space. We are delighted to have been involved,” said Sarah Lovedee, Head of Supranational DCM, J.P. Morgan.
“The World Bank has once again proven its established presence with the largest fixed-income investors globally. TD is proud to have played a leading role in this USD 5 billion global benchmark that priced at the tightest spread to US Treasuries for any SSA so far in 2024,” said Paul Eustace, Co-Head Global SSA DCM, TD Securities.
