The World Bank’s recent Sustainable Development Bond, amounting to $3 billion, witnessed remarkable oversubscription, signaling resounding success and strong interest from stakeholders across the global business and development ecosystem. This 7-year bond is specifically designed to address critical areas of concern, including job creation, climate change, fragility, and pandemics. For more insights into the Sustainable Development Bond, refer to the comprehensive ESG report from The middle Road here.
Additionally, Nishant Malhotra’s insightful webinar for Atal Innovation Mission offers valuable perspectives on this topic.
Check out the online course on Impact Bonds to know more about the social and development impact bonds. Learn about their definition, structure, actors involved, the distinction between Social and Development Impact Bonds with an overview of basics derivatives example call option and bond’s classification as an asset class. Explore real-world for example Educate Girls impact bond, understand impact bond’s limitations, and test your knowledge with a quiz. Earn a certification upon completion. 🎓
“We express our heartfelt gratitude for the overwhelming support from a diverse global investor community in our inaugural benchmark transaction this fiscal year,” stated Jorge Familiar, Vice President and Treasurer of the World Bank.
The bond issuance attracted widespread interest from various actors, with notable participation from global private investors, bank treasuries, and asset managers. Its prestigious triple-A credit rating appealed to central banks, making it an attractive choice due to high-quality rating and liquidity. Among the investors, banks, bank treasuries, and corporates accounted for 49 percent, while central banks and official institutions represented 36 percent, showcasing widespread appeal among esteemed global financial players. BMO Capital Markets, Bank of America Securities, J.P. Morgan, and Morgan Stanley & Co International Plc served as the bond’s lead managers. The bond offers an appealing spread of +16.2 basis points compared to the reference US Treasury, with a semi-annual yield of 3.871 percent. Furthermore, the bond pays a 4 percent coupon, distributed semi-annually, with an issue yield of 4.033 percent semi-annual.
In conclusion, Sustainable Development Bonds, as a part of sustainable finance, play a crucial role in addressing funding gaps in the development sector. In recent years, multilateral institutions increasingly deploy these bonds to raise capital from diverse investors, facilitating essential projects within the global development sector. The strong response to the World Bank’s Sustainable Development Bond underscores the significance of sustainable finance in driving positive change and advancing impactful initiatives worldwide.
Register for free here to access many free online courses on The middle Road.
Read Cameroon Cataract Bond published on The middle Road.
Note: Kindly get in touch with Nishant Malhotra for corporate deals for impact bonds and other offerings from The middle Road; email id nishant@themiddleroad.org.