AfDB launches $2bn 1.625% global benchmark bond

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6 years ago

THE African Development Bank, rated Aaa/AAA/AAA (Moody’s/S&P/Fitch, all stable), has launched and priced a US$ 2 billion 3-year Global Benchmark bond due 16 September 2022, its first US$ benchmark of the year.

A statement signed by Hassatou Diop N’Sele, Group Treasurer, African Development Bank and made available to Nigerian Tribune, explained that the bond issue launched on September 11, is the Bank’s second Global Benchmark of 2019, following a EUR 1 billion 10-year priced in March 2019.

With this transaction, the Bank has now raised US$ 4.4 billion in 2019 to date and executed 61 per cent of its borrowing program for the year. The transaction received strong support from investors globally, with order books reaching US$ 2.8 billion and 53 investors participating, the statement noted. The high quality of the order book is illustrated by the strong participation of Central Banks and Official Institutions, taking 64 per cent of the allocations.

It further explained that the African Development Bank decided to take advantage of favorable investor sentiment post summer break to access the 3-year tenor, in spite of volatile market conditions ahead of the Fed Meeting the following week. The mandate was announced on Tuesday, September 10, at 12:00 London time with Initial Pricing Thoughts of Mid-Swaps + 13 basis points (bps) area.

According to the statement,the transaction met strong interest from the outset, with Indications of Interest in excess of US$ 1.8 billion (excluding Joint-Lead Managers interest) when order books officially opened at 08:00 London time the following morning, with initial price guidance of Mid-Swaps + 13bps area.

“We are delighted with this successful dollar Global Benchmark, and particularly pleased by both the very high quality of the order book and the solid participation of African Central Banks. The African Development Bank achieved its tightest ever spread to US Treasuries, and we are grateful to our investors across the world for this outcome, and the financing it will bring to the African continent,” the bank emphasized.