WASHINGTON, DC, January 10, 2024 - The International Development Association (IDA, Aaa/AAA) priced its first transaction of 2024 – a 20-year Sustainable Development Bond that raised EUR 1.75 billion. This is the issuer’s second 20-year benchmark in euros.
The bond has an annual coupon of 3.200% and an issue price of 99.752%. The bond’s spread over the 3.250% July-2042 German Bund reference bond +78.7 basis points, offering investors an annual yield of 3.217%.
"This transaction strengthens IDA’s yield curve at the long end and supports its long-term lending for sustainable development to member countries. We extend our thanks to investors for their support and interest in IDA’s work to boost economic growth, reduce inequalities, and improve people’s living conditions on a livable planet,” said Jorge Familiar, Vice President and Treasurer, World Bank.
Investor Distribution
Distribution by Geography | % | Distribution by Investor Type | % |
Germany | 36% | Asset Managers / Insurances / Pension Funds | 65% |
France | 19% | Banks / Bank Treasuries / Corporates | 29% |
Rest of Europe | 26% | Central Banks / Official Institutions | 6% |
United Kingdom | 14% |
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Others | 5% |
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Lead Manager Quotes
“Congratulations to IDA on its return to the EUR market. IDA’s presence in the long-end of the EUR market is clearly demonstrated by today’s trade – with the strength and granularity of the order book highlighting the diverse appeal of the IDA name and support for its sustainable development mission,” said, Kamini Sumra, Managing Director SSA Origination, BofA Securities.
“IDA’s strategic approach to the EUR market combined with its ability to seize available windows supported execution of this new 20-year EUR benchmark transaction. The issuer’s ability to bring maturity diversification has been crucial against a backdrop of hectic primary activity at the start of the year, and Crédit Agricole CIB is honored and proud to be associated with IDA’s first benchmark of 2024,” said Eric Busnel, Deputy Head SSA DCM Origination, Crédit Agricole CIB.
“Today’s deal demonstrates the following IDA has established amongst European investors across the spectrum. At the beginning of a new year we are reminded of the important work of IDA for the world’s developing countries and the use of these proceeds in support of sustainable development. This first 20-year syndication in the Sovereign, Supranational, Agency (SSA) space of 2024 sets a precedent for long funding. It confirms the role of the EUR as the key currency for managing the long end on the liability side. We are very pleased that we could contribute to this transaction,” said Friedrich Luithlen, Managing Director, Head of Syndicate and DCM, DZ BANK.
“The IDA team were quick take advantage of renewed demand for duration in the EUR market, building on a positive reopening of the primary market to launch the longest supranational deal so far this year. Drawing over EUR 2.7 billion of demand from more than 80 investors globally, IDA has once again demonstrated the diverse and granular investor base it has built in the EUR market. Congratulations to IDA for the smooth execution. J.P. Morgan is proud to have once again assisted in bringing IDA to the capital markets and contributed to the issuer's sustainable developmental mission,” said Sarah Lovedee, Head of Supranational DCM, J.P. Morgan.
Transaction Summary
Issuer: | International Development Association (IDA) |
Issuer rating: | Aaa/AAA |
Amount: | EUR 1,750,000,000 |
Format | Reg S - Registered Notes |
Settlement date: | January 18, 2024 |
Maturity date: | January 18, 2044 |
Issue price: | 99.752% |
Issue yield: | 3.217% per annum |
Coupon: | 3.200% per annum |
Coupon payment dates: | Annually, on January 18 of each year |
Clearing systems: | Euroclear/Clearstream |
Denomination: | EUR 1,000 |
Listing: | Luxembourg Stock Exchange |
Lead managers: | BofA Securities, Credit Agricole CIB, DZ Bank, and J.P. Morgan |
ISIN: | XS2749537481 |
This press release does not constitute or form part of and should not be construed as an offer for sale or issue or the solicitation of an offer to buy or acquire the securities described in any jurisdiction or an inducement to enter into investment activity. No part of this press release, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The offering and sale of the securities described in this document are subject to restrictions under the laws of several jurisdictions. Securities may not be offered or sold except in compliance with all such laws.
Net proceeds of the securities described herein are not committed or earmarked for lending to, or financing of, any particular projects or programs. Payments on the securities described herein are not funded by any particular project or program.
About IDA
The International Development Association (IDA), rated Aaa/P-1 and AAA/A-1+ (Moody’s/S&P), is one of the largest sources of funding for fighting extreme poverty in the world’s poorest countries. Since its establishment in 1960, IDA has provided about USD400 billion for investments in over 100 countries. As an institution of the World Bank Group, IDA combines global expertise with an exclusive focus on reducing poverty and boosting prosperity. Proceeds of IDA bonds support sustainable development projects and programs in IDA eligible countries. Projects and programs supported by IDA are designed to achieve a positive social impact and undergo a rigorous review and internal approval process aimed at safeguarding equitable and sustainable economic growth. Information on IDA bonds is available at https://treasury.worldbank.org/IDAfunding
Contact
Heike Reichelt, Head of Investor Relations and Sustainable Finance, World Bank Treasury,
IDAInvestorRelations@worldbank.org
+1 202 477 2880