MANILA, PHILIPPINES (27 April 2017) — The Asian Development Bank (ADB) returned to the US dollar bond market with the pricing of a $4 billion 3-year global benchmark bond issue, proceeds of which will be part of ADB’s ordinary capital resources.
“The market tone felt extremely constructive in the run up to the Japanese Golden Week holidays and I am delighted to see such a strong reception from investors for ADB’s credit and mission,” said ADB Treasurer Pierre Van Peteghem. “This transaction breaks our previous record for the largest-ever US Dollar global benchmark issue from February, when we issued a $3.75 billion 5-year, and sends a very strong message to our stakeholders ahead of ADB’s 50th Annual Meeting in Yokohama next week.”
The 3-year bond, with a coupon rate of 1.625% per annum payable semi-annually and a maturity date of 5 May 2020, was priced at 99.776% to yield 23.2 basis points over the 1.5% US Treasury notes due April 2020.
The transaction was lead-managed by BMO Capital Markets, Citi, Deutsche Bank, and RBC Capital Markets. A syndicate group was also formed consisting of BNP Paribas, CACIB, Daiwa Securities, HSBC, ING, J.P. Morgan, Mizuho International, Nomura, TD Securities, and Wells Fargo.
The issue achieved wide primary market distribution with 34% of the bonds placed in Asia, 32% in Europe, Middle East, and Africa, and 34% in the Americas. By investor type, 59% of the bonds went to central banks and official institutions, 16% to banks, and 25% to fund managers and other types of investors.
ADB plans to raise around $25-30 billion from the capital markets in 2017.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB in December 2016 marked 50 years of development partnership in Asia. It is owned by 67 members—48 from the region.