MANILA, PHILIPPINES – The Asian Development Bank (ADB) yesterday raised €1.5 billion from its first euro-denominated benchmark bond. The proceeds from the 3-year bond will be part of the bank's ordinary capital resources and used in its non-concessional operations.
"We are very satisfied with this maiden issue in euros and the strong demand from a broad set of investors, which resulted in an oversubscribed book. Such a positive reception enabled us to increase the size of the issue from €1 billion to €1.5 billion," said ADB Treasurer Mikio Kashiwagi.
The bonds, with a coupon rate of 0.375% per annum payable annually and a maturity date of 3 April 2017, were priced at 99.860% to yield 16.9 basis points over the 0.5% German government notes (OBL #163) due April 2017.
The transaction was lead managed by BNP Paribas, Deutsche Bank, Goldman Sachs International, and HSBC.
The issue achieved wide primary market distribution with 33% of the bonds placed in Asia, 66% in Europe, Middle East and Africa, and 1% in the Americas. By investor type, 64% of the bonds went to central bank and official institutions, 19% to banks, 15% to fund managers, and 2% to other types of investors.
ADB plans to raise around $13 to $15 billion from the bond markets in 2014.