WASHINGTON, D.C., July 17 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) today priced two Sustainable Development Bonds, raising a total of USD 2.7 billion. The benchmarks included a USD 2 billion 3-year bond linked to the Secured Overnight Financing Rate (SOFR) index, maturing in June 2027, and a USD 700 million tap of an existing 7-year bond linked to SOFR index, maturing in February 2031.
The dual tranche transaction attracted over 110 orders with an order book of nearly USD 4.7 billion [which was] bolstered by a diverse set of global investors seeking a high credit quality product in floating rate format. The 3-year SOFR-index linked note pays a coupon of Compounded SOFR +27 basis points and the existing 7-year SOFR-index linked note pays a coupon of Compounded SOFR +37 basis points.
HSBC Bank Plc., The Bank of Nova Scotia, and Wells Fargo Securities, LLC are the lead managers for the transaction. The bond will be listed on the Luxembourg Stock Exchange.
“We are grateful for the enormous level of support we received for this SOFR dual tranche benchmark which jumpstarts our fiscal year in US dollar benchmark program,” said Jorge Familiar, Vice President and Treasurer, World Bank. “As the size of the order book demonstrates, investors recognize our commitment to the SOFR market and very much welcome an opportunity to participate across different points on the yield curve.”
Investor Breakdown by Type
3-Year |
7-Year |
|
Banks/Bank Treasuries/Corporates |
62% |
97% |
Asset Managers/Insurance/Pension Funds |
20% |
2% |
Central Banks/Official Institutions |
18% |
1% |
Investor Breakdown by Geography
3-Year |
7-Year |
|
Europe/Middle East/Africa |
56% |
71% |
Americas |
41% |
21% |
Asia |
3% |
8% |
Lead Manager Quotes
“Congratulations to the World Bank team on printing largest Supranational SOFR Floating Rate Note (FRN) transaction since 2022. The dual tranche generated significant support from a diverse mix of high-quality investors. This once again demonstrates the World Bank’s status as a leading borrower in the US dollar market, with strong market access across formats and tenors,” said Asif Sherani, Head of Syndicate EMEA and Head of Public Sector DCM at HSBC.
“Scotiabank was pleased to serve as a joint bookrunner for this strategically timed dual tranche. The depth and diversity of investors involved in this transaction underscores the World Bank’s top credit quality and sustainable development purpose. Congratulations to the team on today’s transaction!” said Bob Nguyen, Global Head of Fixed Income Origination, Scotiabank.
“This dual tranche transaction reaffirms the World Bank’s position as the most active SSA borrower in the US dollar floating rate space and as result, the one with deepest and most diverse investor bases in the product. Driven mainly by strong bank treasury demand, the oversubscribed orderbook allowed price tightening on the 3-year, and an increase from the issuer’s minimum issue size on both tranches. Congratulations to the World Bank team for being a leader in the FRN market,” said Carlos Perezgrovas, Head SSA Origination, Wells Fargo Securities.
Transaction Summary
3-Year |
7-Year |
|
Issuer: |
World Bank (International Bank for Reconstruction and Development) |
|
Issuer rating: |
Aaa / AAA (Moody’s/S&P) |
|
Amount: |
USD 2,000,000,000 |
USD 700,000,000 |
Settlement date: |
July 24, 2024 |
|
Maturity date: |
June 15, 2027 |
February 11, 2031 |
Coupon: |
Compounded SOFR + 27 bps |
Compounded SOFR + 37 bps |
Coupon payment dates: |
March 15, June 15, September 15 and December 15 of each year |
February 11, May 11, August 11 and November 11 of each year |
Issue Price: |
100.00% |
99.561% |
Denomination: |
USD 1,000 |
USD 1,000 |
ISIN: |
US459058LH49 |
US459058JU87 |
Clearing systems: |
Fedwire, Euroclear, Clearstream |
|
Listing |
Luxembourg Stock Exchange |
|
Joint lead managers: |
HSBC Bank Plc., The Bank of Nova Scotia, London Branch, and Wells Fargo Securities, LLC |
About the World Bank