WASHINGTON, D.C., February 3, 2021 - The International Development Association (IDA, Aaa/AAA) made its second transaction in the sterling market with a 7-year benchmark bond that raised GBP 1 billion. The bond matures in September 2027.
The bond pays an annual coupon of 0.375% and has an issue price of 99.854%. It has a final spread of +26 basis points over the 1.25% UK Gilt due July 2027 reference bond, offering investors a semi-annual yield of 0.397%. IDA raises funds to support its member countries’ sustainable development activities, including projects and programs to address the human and economic impacts of COVID-19.
J.P. Morgan, NatWest Markets, Nomura, and TD Securities are the joint lead managers for the transaction which attracted 33 orders from a globally diverse group of high-quality investors who appreciate IDA’s long-term value.
“We thank the investors for joining the transaction which further demonstrates IDA’s growing track record in the bond markets,” said Jingdong Hua, Vice President and Treasurer, World Bank.“A larger and steady capital market program supports IDA’s efforts to provide one of largest sources of funding to the world’s poorest countries, helping reduce poverty and provide basic social services as they urgently respond to the COVID-19 pandemic.”
By Investor Type
Europe, the Middle East and Africa
Central Banks/ Official Institutions
Banks / Bank Treasuries / Corporates
Asset Managers / Insurance / Pension Funds
Joint Lead Manager Quotes
"We congratulate the IDA team for an impressive start of 2021. Following the inaugural 5-year GBP benchmark in 2020, this second GBP benchmark with a September 2027 maturity is an important step in building out their curve and maintaining a presence in the strategically important GBP market. The high-quality demand from the full spectrum of investors reflects the success of the comprehensive investor relations work that IDA has dedicated themselves to, which sets the tone for future benchmarks issuances,” said Mark Byrne, Director of Fixed Income Syndication, TD Securities.
“NatWest Markets is honored to joint lead manage IDA’s second sterling issuance. Raising 1 billion in a 7-year maturity is a difficult feat for seasoned sterling issuers. For IDA to accomplish this on their second outing is testament to the growing appeal of its high-quality credit. This issuance reflects our wider commitment and focus on supporting sustainable development, and we are proud to help IDA expand its global investor base and advance its mission to eradicate extreme poverty in a sustainable manner,” said Kerr Finlayson, Managing Director, Head of Frequent Borrower Group Syndicate, NatWest Markets.
"This transaction marks a strong return to the GBP markets for IDA, following from the success of its inaugural 5-year transaction a year ago. With today's deal IDA has demonstrated continued access to the GBP market, joining several of its Sovereign, Supranational and Agency (SSA) peers with bonds issued in the 7-year maturity. Sizing a bond at GBP 1 billion with over 30 investors whilst simultaneously extending into the 2027 maturity bucket is quite an achievement. The team at Nomura are delighted to have taken part," said Spencer Dove, Head of DCM Public Sector, Nomura.
"An impressive return to the sterling market for IDA. With its second GBP trade, IDA extends its fixed rate curve with a GBP 1 billion September 2027 issue and the longest GBP SSA trade of the year to date, a testament to the efforts of the World Bank funding team. Congratulations and it was a pleasure for the J.P. Morgan team to be involved!" said Matthieu Batard, Head of SSA Syndicate, J.P. Morgan.
International Development Association (IDA)
Reg S - Registered Notes
February 10, 2021
September 22, 2027
0.375% p.a., payable annually in arrear
GBP 1,000 and multiples thereof
Luxembourg Stock Exchange
J.P. Morgan, NatWest Markets, Nomura, TD Securities
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, and returns on the securities described herein are not linked to the performance of any particular project or program.
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
Head of Investor Relations and Sustainable Finance
+1 202 477 2880