The World Bank priced a new 5-year CAD 1 billion benchmark that matures on January 18, 2028. The World Bank launched the Sustainable Development Bond while raising awareness for the World Bank’s strategy, projects, and programs that support developing countries in the sustainable management of biodiversity and ecosystem services and integrating nature in development.
The 5-year benchmark transaction pays a semi-annual coupon of 3.70% p.a. and has an issue price of 99.900% and a final spread of 38.5 bps over the CAN 2.75% September 2027 reference bond, offering investors a yield of 3.722% (semi-annual). Joint lead managers for this transaction are BMO Capital Markets, National Bank Financial Markets, RBC Capital Markets, and TD Securities.
Jorge Familiar, Vice President and Treasurer, World Bank, said “We are happy to be back in the Canadian dollar market and value the continued support from Canadian and international investors. We also appreciate the opportunity to highlight the critical role of biodiversity and nature as part of the World Bank’s work to support sustainable development in member countries.”
Investor Distribution
| By Investor Type | By Geography | ||
| Banks/Bank Treasuries/Corporates | 44% | Americas | 64% |
| Central Banks/Official Institutions | 33% | Europe/Middle East/Africa | 26% |
| Asset Managers/Insurance/Pension Funds | 23% | Asia | 10% |
Joint Lead Managers Quotes
Sean Hayes, Managing Director & Head, US Syndicate & Credit Sales, BMO Capital Markets, said, “True to tradition, World Bank re-opens the Sovereign, Supranational, and Agency (SSA) Canadian dollar primary markets for the sixth consecutive year with a successful CAD 1 billion 5-year Sustainable Development Bond while raising awareness for biodiversity. The new issue, which places a spotlight on the threats of nature loss, drew strong support from a diverse set of global and Canadian domestic high quality investors seeking investment for impact. BMO was delighted to have been a part of the transaction.”
Scott Graham, Managing Director and Head of US Government and SSA Finance, National Bank Financial Markets, said, “The World Bank once again demonstrates its commitment and leadership to the Canadian fixed income markets with its highly successful CAD 1 billion 5-year benchmark. The deal was extremely well received with broad domestic and international demand. The commitment by the World Bank to large, liquid, and well-priced Canadian dollar benchmark transactions is welcomed by investors. NBF was thrilled to partner with the World Bank in reopening the Maple market in the first few days of 2023.”
See related article: World Bank Seeks More Funds to Address Climate Change, Other Crises
Jigme Shingsar, Managing Director, RBC Capital Markets, LLC, said, “Re-opening markets is a World Bank specialty, and this well-timed benchmark has the additional bonus of offering Canadian dollar investors a unique opportunity to highlight support for biodiversity. Enthusiasm for the both the World Bank credit and raising awareness for biodiversity was reflected in domestic distribution setting recent highs and bodes well for the continued development of the Canadian dollar market for SSA issuance.”
Steven Castle, Managing Director, Head of Government Finance, TD Securities, said,“We congratulate the World Bank for successfully opening the Maple market in 2023 with a 5-year CAD 1 billion Sustainable Development Bond, which aims at raising awareness for biodiversity. With final orderbooks in excess of CAD 1.2 billion, this transaction has attracted high quality investors globally and TD was delighted to be involved for such an important project.”
Transaction Summary:
| Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
| Issuer rating: | Aaa/AAA (Moody’s/S&P) |
| Amount: | CAD 1,000,000,000 |
| Settlement date: | January 18, 2023 |
| Maturity date: | January 18, 2028 |
| Issue price: | 99.900% |
| Issue yield: | 3.722% semi-annually |
| Coupon: | 3.70% per annum |
| Denomination: | CAD 1,000 |
| Listing: | Luxembourg Stock Exchange |
| ISIN: | CA459058KM45 |
| Clearing system: | CDS, Clearstream, Euroclear |
| Joint lead managers: | BMO Capital Markets, National Bank Financial Inc., RBC Capital Markets and TD Securities |