World Bank Starts 2023 Funding Program with 1.5 Billion Australian Dollar Benchmark

The World Bank (International Bank for Reconstruction and Development, IBRD rated Aaa/AAA) has priced its first benchmark of 2023 – an Australian dollar 1.5 billion 5-year bond due January 13, 2028. This 4.40% fixed-rate bond equates to a spread of +81.25 basis points over the Australian government bond due November 2027.

The transaction attracted over 50 orders totaling more than AUD 1.6 billion from investors drawn to IBRD’s high credit quality while supporting the World Bank’s mission.  World Bank Sustainable Development Bonds support the financing of green and social projects, programs and activities in IBRD member countries.

The joint-lead managers for the transaction are ANZ Banking Group Ltd, Commonwealth Bank of Australia, Nomura International plc, and TD Securities.

“We appreciate the strong support for the World Bank by investors in the Australian dollar market,” said Jorge Familiar, Vice President and Treasurer, World Bank. “It’s a great start to 2023 and demonstrates the breadth and depth of global support that the World Bank has among capital market investors eager to support sustainable development activities and the institutions response to the multiple crisis facing people in developing countries.”

Investor Distribution

Joint Lead Manager Quotes

“A fantastic return to the public Kangaroo bond market for IBRD after 14 months since its last issue in 2021. This jumbo deal size of AUD 1.5 billion highlights deep pockets of liquidity and strong demand for the World Bank name in the Australian dollar market,” said Robyn Bedil, Director of Debt Capital Markets, ANZ.

“Congratulations to the World Bank team on a fantastic return to the Kangaroo market, re-opening the Sovereign, Supranational and Agency (SSA) bond market with a 5-year marquee AUD 1.5 billion Sustainable Development Bond benchmark. This was an extremely granular orderbook with more than 50 orders across the spectrum of domestic and international investors. The Commonwealth Bank is proud to have assisted the World Bank with this highly successful transaction,” said Nik Romuld, Head of High-Grade Origination and Syndication, Commonwealth Bank of Australia.

“Congratulations to the World Bank team on a fantastic transaction and the reopening of the AUD SSA market in 2023. The AUD 1.5 billion print is a phenomenal result that can only be achieved through continued commitment to the Australian dollar market, fostering deep and lasting relationships with the investor base and executing the perfect strategy. We are humbled by the trust the World Bank has placed in TD Securities to work on this project and we look forward to continued partnership in the future,” said Yuriy Popovych, Director, TD Securities.

“The transaction was a blockbuster of an outing with the AUD1.5 billion size only ever achieved three times previously in the Kangaroo market! The new 5-year benchmark represents the World Bank’s focus on meeting global investor demand, and serves as another milestone in their 23 years of issuing in the Kangaroo market. Their Sustainable Development Bonds continue to promote awareness of the World Bank’s mandate and are incredibly well received as the global investor community increasingly focuses on the sustainable nature of assets,” said Mark Yeomans, Executive Director, Public Sector Debt Capital Markets, Nomura.

Transaction Summary

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, it is the original member of the World Bank Group and operates as a global development cooperative owned by 189 nations. The World Bank provides loans, guarantees, risk management products, and advisory services to middle-income and other creditworthy countries to support the Sustainable Development Goals and to end extreme poverty and promote shared prosperity. It also provides leadership to coordinate regional and global responses to development challenges. The World Bank has been issuing sustainable development bonds in the international capital markets for over 70 years to fund programs and activities that achieve a positive impact. More information on World Bank bonds is available at www.worldbank.org/debtsecurities.

World Bank bonds support the financing of programs that further the Sustainable Development Goals (SDGs). World Bank bonds are aligned with the Sustainability Bond Guidelines published by the International Capital Market Association and as such support the financing of a combination of green and social, i.e., “sustainable development” projects, programs and activities in IBRD member countries as described in the World Bank Sustainable Development Bond Framework. The World Bank is also a member of the Executive Committee of the Green Bond, Social Bond, and Sustainability Bond Principles. A key priority for the World Bank’s capital markets’ engagement is building strategic partnerships with investors to promote the importance of private sector financing in sustainable development. The World Bank’s Sustainable Development Bond Impact Report describes how the World Bank engages with investors on the SDGs and raises awareness for specific development challenges.

Source – World Bank