World Bank Launches 2021 Funding Year with New 7 year GBP Benchmark

The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) kicked off its new fiscal year with a 7-year British pound sterling (GBP) benchmark bond due July 2028. The Sustainable Development Bond raised GBP 1 billion from investors globally to support the financing of its sustainable development activities.

The bond offers an annual coupon of 0.625% and an annual yield of 0.685%. It was priced at +28 basis points over the 0.125% UK Gilt due January 2028. Bank of America, Deutsche Bank, JP Morgan, and NatWest Markets are joint lead managers for the transaction. The bond will be listed on the Luxembourg Stock Exchange.

Jingdong Hua, World Bank Vice President and Treasurer, said, “With what is usually a slow time in the summer for market activity, we were very pleased to see such strong investor participation in our first IBRD benchmark of the fiscal year. Much remains to be done as the global community continues to respond and recover from the pandemic and the World Bank remains at the forefront supporting member countries in their response. We thank investors for their support.”

The high-quality order book attracted over 40 investors. The majority of the transaction was placed with investors in the United Kingdom.

Investor Distribution

By Geography

By Investor Type

United Kingdom

78%

Banks/Bank Treasuries/Corporates

57%

Europe

12%

Asset Mangers/Insurance/Pension Funds

23%

Asia

7%

Central Banks/Official Institutions

20%

Americas

3%

Joint Lead Manager Quotes

Adrien de Naurois, Managing Director, BofA Securities, said, “An outstanding start for the World Bank’s new fiscal year with its first sterling outing of 2021. The issuer was able to navigate a volatile trading session on the back of continued support from its high quality and diversified investor base. This demonstrates once again the high standing of the World Bank’s credit and overall position in the capital markets.”

Katrin Wehle, Managing Director, SSA DCM, Deutsche Bank, said, “The World Bank kicked off their financial year with a highly successful new GBP 1 billion 7-year Sustainable Development Bond. The superb reception of the deal from both high quality local as well as a diverse pool of global investors was reflected in the dynamic book building and oversubscription. This transaction reinforces the World Bank’s commitment towards supporting their sustainable development goals and cements its status as a benchmark issuer in the GBP market. A fantastic return to the sterling market and Deutsche Bank is proud to have supported this landmark transaction.”

Keith Price, Managing Director, Head of Frequent Borrowers Group, J.P. Morgan, said, “A stellar return to the sterling market from the World Bank to kick-start their new fiscal year and first GBP deal of 2021. By offering a new 2028 reference point with such a high quality orderbook, the transaction highlighted the World Bank’s exceptional standing amongst the UK investor base. J.P. Morgan was delighted to be involved.”

Kerr Finlayson, Managing Director, Head of Frequent Borrower Group Syndicate, NatWest Markets, said, “The World Bank continues to innovate in capital markets, bringing to market the first sterling 2028 maturity since 2001. By offering investors an attractive SONIA spread and creating a new reference point in 2028, they have once again been rewarded with strong demand from a loyal investor base. In the end, a GBP 1 billion print reiterates the high standing in which the World Bank’s credit is held amongst investors. The choice to issue in GBP as the first issuance of the new financial year underlines the World Bank’s sincere commitment to this market and we are incredibly proud to be involved at NatWest.

Transaction Summary

Issuer

World Bank (International Bank for Reconstruction and Development, IBRD)

Issuer rating:

Aaa / AAA

Amount:

GBP 1,000,000,000

Settlement date:

15 July 2021

Maturity date:

14 July 2028

Issue price:

99.590%

Issue yield:

0.685% annual

Denomination:

GBP 1,000

Coupon:

0.625% per annum

Listing

Luxembourg Stock Exchange

ISIN

XS2365061931

Clearing systems

Euroclear/ Clearstream Luxembourg

Joint lead managers

Bank of America, Deutsche Bank, JP Morgan, and NatWest Markets

About the World Bank

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