World Bank Prices Its First SOFR-Linked Floating Rate Bond of 2023
The transaction attracted over 35 orders totaling nearly USD 2 billion from a diverse set of investors seeking a high credit quality investment while supporting sustainable development. The 4-year SOFR-index linked note pays a coupon of Compounded SOFR + 37 basis points. BMO Capital Markets, Scotiabank, and Wells Fargo Securities are the lead managers for the transaction. The bond will be listed on the Luxembourg Stock Exchange.
Jorge Familiar, Vice President and Treasurer, World Bank, said, “We are pleased to launch this first SOFR floating rate transaction of 2023 and remain committed to the development of the SOFR market. We thank investors for their support of the World Bank's sustainable development mandate and strong showing in this important and growing market.”
Investor Distribution
|
By Investor Type |
By Geography | ||
|
Central Banks/Official Institutions |
11% |
Europe/Middle East/Africa |
50% |
|
Banks/Bank Treasuries/Corporates |
81% |
Americas |
43% |
|
Asset Managers/Insurance/Pension Funds |
8% |
Asia |
7% |
Joint Lead Manager Quotes
Sean Hayes, Managing Director & Head, US Syndicate & Credit Sales, BMO Capital Markets, said, “The World Bank cements their status as a leader in the US dollar market with an outstanding SOFR floating rate note (FRN) print as their first US dollar benchmark of 2023. At $1.75 billion the deal marks the largest 4-year SOFR FRN new issue in the Sovereign, Supranational, and Agency (SSA) sector, and demonstrates the depth of demand for high-quality floating rate assets. The transaction achieved a high-quality distribution with an oversubscribed orderbook and attracted new investors to the FRN format. Congratulations, World Bank, on an exceptional US dollar return.”
Cesare Roselli, Global Head of SSA Origination, Scotiabank, said, “Scotiabank is proud to support the World Bank in its first US dollar-denominated transaction of 2023: a highly successful SOFR-linked Sustainable Development Bond and the first FRN issue that the SSA market has seen this year. This transaction illustrates the World Bank’s standing as the leading USD SOFR issuer in the SSA market and its commitment to sustainable development.”
Carlos Perezgrovas, Head SSA Origination, Wells Fargo Securities, said, “No better way to start the year for the World Bank than by delivering an oversubscribed and well-placed US dollar benchmark transaction. It also marks the return of the SOFR FRN primary market that had been absent for months. Congratulations on a USD 1.75 billion trade done at a level in line with fixed rate secondaries. A complete success for the World Bank team!”
Transaction Summary
|
Issuer: |
World Bank (International Bank for Reconstruction and Development) |
|
Issuer rating: |
Aaa / AAA (Moody’s/S&P) |
|
Amount: |
USD 1,750,000,000 |
|
Settlement date: |
January 12, 2023 |
|
Maturity date: |
January 12, 2027 |
|
Coupon: |
Compounded SOFR + 37 bps |
|
Coupon payment dates: |
Paid quarterly on each January 12, April 12, July 12 and October 12. |
|
Issue Price: |
100.00% |
|
Denomination: |
USD 1,000 |
|
ISIN: |
US459058KN26 |
|
Clearing systems: |
Fedwire, Euroclear, Clearstream |
|
Listing |
Luxembourg Stock Exchange |
|
Joint lead managers: |
Wells Fargo Securities, BMO Capital Markets, Scotiabank |
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