ADB Sells $5.5 Billion Dual Tranche 3- and 10-Year Global Benchmark Bonds

By India Education Diary Bureau Admin On Jan 6, 2023

MANILA — The Asian Development Bank (ADB) yesterday priced a 3-year global benchmark United States (US) dollar bond worth $3.5 billion and a 10-year global benchmark US dollar bond worth $2 billion, proceeds of which will be part of ADB’s ordinary capital resources used to support development across Asia and the Pacific.

“We appreciate the strong support from our investors across regions in our first global benchmark outing of the year,” said ADB Treasurer Pierre Van Peteghem. “With an orderbook of over $13 billion, we raised $5.5 billion across the two tranches, providing ADB with additional resources as we help our developing member countries tackle challenges, including recovery from the pandemic, food security, and climate change.”

The 3-year bond, with a coupon rate of 4.25% per annum payable semi-annually and a maturity date of 9 January 2026, was priced at 99.720% to yield 14.1 basis points over the 4% US Treasury notes due December 2025.

The 10-year bond, with a coupon rate of 4% per annum payable semi-annually and a maturity date of 12 January 2033, was priced at 99.812% to yield 28.625 basis points over the 4.125% US Treasury notes due November 2032.

The transaction was lead-managed by Citigroup Global Markets, Nomura, RBC Capital Markets, and TD Securities. A syndicate group was also formed consisting of CIBC Capital Markets, DBS Bank, ING Bank, and Scotiabank.

Both tranches achieved wide primary market distribution. On the 3-year issue, 45% of the bonds were placed in Europe, Middle East, and Africa; 43% in the Americas; and 12% in Asia. By investor type, 47% of the bonds went to central banks and official institutions, 34% to banks, and 19% to fund managers and other types of investors. On the 10-year issue, 66% of the bonds were placed in Europe, Middle East, and Africa; 25% in the Americas; and 9% in Asia. By investor type, 47% of the bonds went to banks, 21% to central banks and official institutions, and 32% to fund managers and other types of investors.

ADB plans to raise about $31 billion–$33 billion from capital markets in 2023.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 68 members—49 from the region.