World Bank (IBRD) structured notes provide investors a chance to customize the investment terms (i.e., reverse inquiry). Benefits include:
- AAA/Aaa issuer credit rating
- Potential yield enhancement
- Opportunity to express views on yield curves, currencies, inflation rates, equity indices, and other risk factors
- Fast and flexible execution.
Various types of World Bank (IBRD) structured notes may include:
- Callable or puttable notes
- Floating rate notes with caps, floors or collars
- Step-up and step-down coupons
- Notes linked to an equity, bond, hedge fund index, or to a constant maturity swap rate
- Dual currency notes
- Powered dual currency notes with foreign exchange optionality
- Other unique structures as requested by an investor and designed together with the World Bank.
Typical Features of World Bank (IBRD) Structured Notes
- Issuer: International Bank for Reconstruction and Development (IBRD)
- Distribution: Private placements or public offerings
- Documentation: Issued under Global Debt Issuance Facility (GDIF) with Final Terms to document the specific terms of the issues
- Governing Law: Generally New York or English Law
- Listing: Optional, generally in Luxembourg
- Rating: GDIF is rated AAA/Aaa (separate individual note ratings feasible)
- Clearing: Generally Euroclear and Clearstream (either bearer or registered format); DTC (registered format only)
- Currencies: Wide range of currencies
Liquidity Backstop
The World Bank expects dealers in all World Bank bonds – including structured notes – to provide secondary markets in the bonds that they underwrite. The World Bank may, at its discretion, buy back all or a portion of certain debt issues from approved dealers at market prices, subject to asset-liability constraints.
