AfDB launches $1 billion global benchmark bond

16 Sep 2016
Financial Nigeria

Summary

The AfDB said the bond, which is due on September 20, 2019, has a coupon rate of 1.25 percent and a spread of mid-swaps plus 9 basis points.

Akinwumi Adesina, President, African Development Bank

The African Development Bank has launched a $1 billion three-year global benchmark bond to fund its operations across Africa, according to a statement released on Thursday.    

The bond offering generated strong demand from investors when books opened officially at 8.10am on Wednesday, with orders exceeding $1 billion, the Abidjan-based multilateral institution said.

A breakdown of the distribution order book by investor type shows that central banks and other official institutions accounted for 67 percent; fund managers, 17 percent; banks, 11 percent; and pension funds and corporates, 5 percent.

About 46 percent of the orders came from the Americas while 38 percent came from Europe. Orders from Asia and the Middle East and Africa stood at 11 percent and 5 percent, respectively. The final order book stood in excess of $1.3 billion, with 40 investors participating.

The AfDB said the bond, which is due on September 20, 2019, has a coupon rate of 1.25 percent and a spread of mid-swaps plus 9 basis points. (This is equivalent to 26.2 basis points over the 0.875 percent United States Treasury notes due in September 2019).

Barclays, Bank of America Merrill Lynch, J.P. Morgan, and TD Securities acted as joint lead managers of the bond offering.


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