The FINANCIAL — The World Bank (IBRD, Aaa/AAA) priced today a 30-year euro-denominated benchmark bond maturing in January 2051, raising EUR 2 billion from institutional investors around the globe to support the financing of its sustainable development activities.
Credit Agricole CIB, Goldman Sachs International, and Morgan Stanley are the lead managers for the transaction. The bond will be listed on the Luxemburg Stock Exchange.
The EUR 2 billion bond was oversubscribed, with an orderbook reaching over EUR 4 billion from more than 120 orders. The bond offers investors an issue price of 98.241% and a coupon of 0.125% per annum, equivalent to an annual yield of 0.185%. This equates to a spread versus the reference Bund of +36.7 basis points.
“This is another milestone – the bond extends our yield curve and offers investors a new liquid 30-year reference point. We are happy to see such strong investor demand for this long-dated benchmark. This benchmark, and all of our Sustainable Development Bonds, help us serve our member countries and further the World Bank’s sustainable development mission,” said Jingdong Hua, Vice President and Treasurer, World Bank.
The bonds were placed mostly with investors in Germany and France, with about one third placed with investors in other European countries and the rest of the world. By investor type, the distribution was 85% with asset managers, insurance companies and pension funds, 10% with banks, bank treasuries and corporates, and 5% with central banks and official institutions.
Joint Lead Manager Quotes
“The World Bank has really hit the sweet spot of the market at the perfect time with this transaction, combining fine pricing with an orderbook of exceptional quality. The momentum in the EUR primary market has been very strong over the last few days and with increasing appetite for duration and a good window of issuance ahead of the ECB meeting and further supply to come, the issuer has managed to align all the stars and offer a rare treat to investors, another testimony of the unique attraction of the World Bank name in the market,” said Eric Busnel, Deputy Global Head of Sovereign, Supranational and Agencies (SSA) Debt Capital Markets, Credit Agricole CIB.
“Another tremendous outcome for the World Bank, printing their largest ever 30-year benchmark at EUR 2 billion. The high-quality orderbook, which was heavily oversubscribed, was also the largest ever the issuer has collected for a transaction in the long end of the curve. Such a successful issuance less than a week after the pricing of their USD 6 billion 5-year USD benchmark is further indication that the World Bank’s investor following is truly global and that it encompasses a very diverse range of accounts,” said Ben Adubi, Head of SSA Syndicate, Morgan Stanley.
“A fantastic return to the long-end of the curve in EUR for the World Bank, achieving their largest benchmark in the 30-year tenor at EUR 2 billion. The World Bank took advantage of appetite for duration and no competing supply in the longer end of curve to launch their new on-the-run 30-year, which was immediately met with strong demand. The high quality and size of the orderbook ultimately allowed the World Bank to price at almost no new issue concession, further highlighting the World Bank’s incredible global investor following,” said Maud Le Moine, Head of SSA Origination, Goldman Sachs International.