World Bank Issues $50 Million Sustainable Development Bond
The World Bank issued a 3-year Chinese yuan denominated Sustainable Development Bond raising CNH 340 million (approximately US$50 million equivalent) due February 2026 while engaging with investors to raise awareness for the importance of sustainable cities. The challenges facing cities are outlined by Sustainable Development Goal (SDG) 11. The bond was placed with Gavekal Capital Limited. HSBC Bank plc acted as the sole lead manager for the transaction.
Building inclusive, resilient, competitive, and sustainable cities and communities is essential for achieving the Sustainable Development Goals by 2030, and the World Bank Group’s goals of eliminating extreme poverty and boosting shared prosperity at the local, regional, and national levels. With cities set to welcome an additional 2.5 billion inhabitants by 2050, the scale and speed of such an urbanization process and the important financing gaps that exist today call for the scaling up of investment in cities, especially when factoring in the impact of climate change in terms of the increased frequency and severity of disasters. Through a combination of tailored financing and policy support the World Bank is helping member governments build livable, inclusive, resilient, climate smart, and competitive cities.
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Heike Reichelt, Head of Investor Relations and Sustainable Finance, World Bank, said, “Cities are home to so many of the world’s poor and vulnerable who are increasingly faced with the effects of climate change and other shocks. The World Bank works with its member countries to design cities that are more resilient, equitable, and sustainable. We are pleased to see continued investor interest in SDG 11 and thank Gavekal for supporting the World Bank’s activities through their investment in World Bank Sustainable Development Bonds.”
Christine Cheung, Head of Asian Fixed Income, Gavekal Capital Limited, said, “The World Bank has always been one of the market leaders in the sustainability space. As such, Gavekal Capital is pleased to support the World Bank’s CNH-denominated Sustainable Development Bond highlighting sustainable cities. Since being designated as Article 8 under the EU’s SFDR, Gavekal Capital has increased its effort to promote the Sustainable Development Goals from the United Nations. We believe causes toward sustainable cities can provide significant impact, considering half of humanity lives in cities. We look forward to working with the World Bank and other high-quality issuers to launch more sustainable bonds in the future.”
The World Bank issues bonds in the international capital markets to support the financing of sustainable development activities designed to achieve positive social and environmental impacts in developing countries, while raising awareness of specific development themes and SGDs across a range of sectors. This transaction aims to raise awareness for the World Bank’s work to build green, resilient, and inclusive cities and communities and SDG 11.