This month, the Inter-American Development Bank (IDB) priced a new $3.75 billion USD five-year global bond listed on the London Stock Exchange, the financial institution’s largest dollar-based five-year benchmark to date.
According to the regional development bank, which is AAA-rated by Moody’s, the transaction will pay a semi-annual coupon of 2.5% and mature on January 18, 2023. It is “priced with a spread of 15.7 basis points over the 2.125% UST due December 31, 2022, which represents a yield of 2.500% s.a.,” said the IDB in a statement.
Orders exceeded $5.2 billion USD from more than 100 investors, which were distributed across the Americas (39% of the investors); Asia and the Pacific (22%); and Europe, Africa, and the Middle East (39%).
As for the types of investors, 48% are banks, 36% are central banks (and other “official institutions”), 13% are asset managers, and the remaining 3% are a collection of pension funds, insurance companies, and corporate investors.
“We usually issue $3 billion USD benchmarks in this maturity and so we are very pleased with the result,” said Laura Fan, head of funding at the IDB.
The joint lead managers are Bank of America Merrill Lynch, BMO Capital Markets, RBC Capital Markets, and TD Securities. The co-lead managers are BNP Paribas, Citibank, Deutsche, Goldman, HSBC, JPM, Mizuho, Nomura, NatWest, and Wells Fargo.
Fen added that the “typical strong demand in January” for the bond issuance made it particularly significant in a number of ways. “It is our largest five-year primary U.S. dollar global benchmark, our largest five-year order book, and a record number of investors for a five-year bond,” she said.