About World Bank Treasury  |  FAQ  |  Contact  
|  

Press Releases


World Bank Returns to Kauri Market with the largest issue so far for 2018

Washington, DC, January 18, 2018 – The World Bank (International Bank for Reconstruction and Development, rated Aaa/AAA), priced a new 5-year Kauri bond raising NZD 700 million. The transaction was the largest and tightest priced 5-year issue by an SSA in what has been an active Kauri market so far, this year.

The issue opened to a strong reception from domestic investors on Wednesday 17 January, New Zealand time, and carried that momentum through Northern Hemisphere trading overnight to build a broad range of domestic institutional investors as well internationally from the Americas, Asia, Australia, and Europe with more than 30 orders from banks and bank treasuries, asset managers, and central banks.

The issue is priced at a yield of 3.076% with a coupon of 3.00%, which represented a margin of 33bps over the 5-year New Zealand mid-swap rate and 62.6bps over the NZGB 5.5% April 2023.

The joint-lead managers for the bond are ANZ, Bank of New Zealand and Commonwealth Bank of Australia.

“We are very pleased with the strong reception for our Kauri bond from investors around the world.  The results of the new transaction demonstrate once again that the Kauri market continues to play an important role in our funding program, and we would like to thank all the investors for their support,” said Andrea Dore, Head of Capital Markets, World Bank.

Investor Distribution

By Geography

By Investor Type

New Zealand

60%

Banks / Bank Treasuries

70%

Asia (non-Japan)

13%

Asset Managers / Insurance

23%

Europe

12%

Central Banks / Official Institutions

7%

Japan

11%

Australia

2%

Americas

2%

Transaction Summary

Issuer:

World Bank (International Bank for Reconstruction and Development, IBRD)

Issuer rating:

Aaa/AAA

Amount:

NZD 700 million

Settlement date:

February 2, 2018

Minimum Subscription:

NZD 1,000 (within New Zealand NZD 750,000)

Denomination:

NZD 1,000 and multiples thereof (within New Zealand, NZD 100,000 with multiples of NZD1,000 thereafter)

Format:

Registered notes

Coupon:

3% p.a. semi-annual

Coupon payment dates:

February 2 and August 2 in each year, beginning on August 2, 2018 (subject to business day conventions), up to and including the maturity date

Maturity date:

February 2, 2023

Re-offer price:

99.650261%

Re-offer yield:

3.076% p.a semi-annual

Listing:

Luxembourg Stock Exchange

Clearing systems:

NZ Clear

ISIN:

NZIBDDT012C6

Joint lead managers:

ANZ, Bank of New Zealand, Commonwealth Bank of Australia

Joint Lead Manager Quotes

“Yet another accomplished issue by World Bank in NZD Kauri.  Over 30 investors more than doubled World Banks new 5-year deal from the initial NZD 300 million launch size to NZD 700 million, making it the largest Kauri print in over 18 months and taking the Kauri market tantalisingly close to NZD 2 billion primary in under two weeks.  It was ANZ’s pleasure to have been involved,” said Glen Sorensen, Debt Syndicate, ANZ.

“The Kauri market has had a strong start to 2018, and this transaction reinforces it in emphatic style. The breadth of demand, from more than 30 accounts, is pleasing to see. World Bank’s consistent approach to the NZD market once again delivered a benchmark size and a deal that works for the issuer and investors,” said Mike Faville, Head of Capital Market, Bank of New Zealand.

“The World Bank has reiterated its standing in the Kauri market pricing the largest issue so far for 2018 in what has been a very active start to the new year. The World Bank quickly mobilised to strike globally competitive conditions ahead of their upcoming maturity of NZD 850 million in February. The high-quality order book, pricing relative to peers and the scale of the issue, highlights the work done by the World Bank in engaging not only domestic investors but managers of New Zealand dollar investments globally. The Kauri market is currently offering a pricing benefit relative to the Kangaroo market in the mid-curve which is likely to see continued supply from the SSA sector,said Brad Peel, Director Debt Capital Markets Origination, CBA New Zealand.    

About the World Bank

The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody’s/S&P), is an international organization created in 1944 and the original member of the World Bank Group. It operates as a global development cooperative owned by 189 nations. It provides its members with financing, expertise and coordination services so they can achieve equitable and sustainable economic growth in their national economies and find effective solutions to pressing regional and global economic and environmental problems. The World Bank has two main goals: to end extreme poverty and promote shared prosperity. It seeks to achieve them primarily by providing loans, risk management products, and expertise on development-related disciplines to its borrowing member government clients in middle-income countries and other creditworthy countries, and by coordinating responses to regional and global challenges. It has been issuing sustainable development bonds in the international capital markets for over 70 years to fund its activities that achieve a positive impact. Information on World Bank bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities.

 

Back to Press Releases