World Bank Re-enters the Sterling Market

Washington, DC, January 15, 2008 – Today, the World Bank (International Bank for Reconstruction and Development, rated Aaa/AAA) issued its first benchmark bond denominated in Sterling (“GBP”) in seven years in response to particularly high levels of demand for the currency from the central bank community. The GBP 350 million bond was lead-managed by Royal Bank of Scotland and UBS Investment Bank. Co-Lead managers were ABN AMRO, Barclays Capital, Dresdner Kleinwort, HSBC, RBC and TD Securities.

For the past several months, the sterling market has experienced increased levels of activity due mainly to wider swap spreads and larger allocations to the Sterling currency by international portfolio managers. Among these international investors, the central bank community has been a prominent buyer of many of the high quality issuance in the shorter maturities, and today’s 2-year bond was issued in direct response to this central bank and other official investor demand. The bond was priced at 99.794% and pays a coupon of 4.50%, which resulted in a spread of 36 basis points over the 4.75% UK Gilt due June 2010.

The mandate was awarded to the lead managers on the evening of Monday, January 14 and the order book was opened on the following morning. Investors reacted immediately to the offering, and the order book grew quickly with central banks in Asia and Europe driving the momentum. They were complemented by significant interest from other investors including European asset, insurance, and pension managers. Two hours after opening, the order book reached GBP 382 million in size. Given the high quality nature of each of the 26 orders, which ranged from GBP 0.5 million to GBP 100 million in size, the decision was made to close the order book.

This World Bank global benchmark bond denominated in British Pounds represents a further extension of the World Bank’s strategy of providing international and domestic investors with a variety of liquid global World Bank bonds in currencies around the world. The World Bank has previously issued and distributed globally, benchmark bonds in US Dollars, Canadian Dollars, Euros, Mexican Pesos, New Zealand Dollars, Polish Zloty, South African Rand, and Turkish Lira in the global format pioneered by the World Bank in 1989.

Final Distribution

Summary terms and conditions

Amount: GBP *350 million
Settlement date: January 25, 2008
Maturity Date: January 25, 2010
Issue / Re-offer price: 99.794%
Coupon: 4.50% paid annually
Denomination: GBP 1,000 and multiples thereof
Listing: Luxembourg
Clearing systems: Euroclear and Clearstream

* The principal amount of the bond was increased on January 6 by the issue of a second tranche for an amount of GBP 50 million with an issue price of 99.989% (settlement date: February 13, 2008). The new total outstanding principal amount is GBP 400 million.

The World Bank's bond products and investor presentation can be accessed through the website of the World Bank for bond investors (www.worldbank.org/debtsecurities). For a list of selected bonds issued recently by the World Bank, see: http://treasury.worldbank.org/recentissues.

About the World Bank

The World Bank is a global development cooperative owned by 185 member countries. Its purpose is to help its members achieve equitable and sustainable economic growth in their national economies and find effective solutions to pressing regional and global problems in economic development and environmental sustainability, all with a view to overcoming poverty and improving standards of living for people worldwide.

To fulfill its mandate, the World Bank Group, working through four specialized entities, provides its members with financial services, access to experts and a pool of knowledge in development-related disciplines as well as convening and strategic services to help members pool, administer and prioritize resources they dedicate to development-related objectives.

The International Bank for Reconstruction and Development (IBRD), rated Aaa/AAA, is the oldest and largest entity in the World Bank Group and provides funding, risk management tools and credit enhancement to sovereigns. To fund this activity, IBRD has been issuing debt securities in the international capital markets for 60 years. The World Bank’s mission to fight poverty and its investments in sustainable development, including in education, health and environment, make IBRD bonds suitable for socially responsible investors. The World Bank is also the Treasury Manager for the International Finance Facility for Immunisation (IFFIm), the world’s first multilateral issuer that provides grants for a specific development purpose – health and immunization programs.

The World Bank has gained recognition as one of the market’s most innovative borrowers. It pioneered the currency swap in 1981, the first global bond (1989) and the first fully electronic bond offering (2000), among other “firsts.” It was IFR’s “Borrower of the Decade” for the 1980s and recognized by bankers in a recent EuroWeek poll as “Most Innovative Borrower over the last 20 years.”

In 2007 the World Bank raised US$11 billion in medium- to long-term funding. The World Bank’s debt products are offered in a variety of currencies and include large bonds distributed globally as well as bonds tailored to retail or institutional investors in specific markets. World Bank debt products provide investors with the assurance of a superior credit rating, a wide choice of products and strong secondary market performance for liquid World Bank global bonds. The World Bank also customizes its debt offerings to meet investors' specific asset and liability needs.

For more information, see www.worldbank.org/debtsecurities.

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