The four-year, 5.65% coupon, structured by Singapore-based Impact Investment Exchange (IIX), will benefit women in Vietnam, Cambodia, and the Philippines. The bond is expected to be listed on the Singapore Exchange this month and will be the first social sustainability bond with a dual focus on social and financial returns to be listed on a major stock exchange.
As part of its commitment to the development of the ASEAN region, USAID is providing a 50% guarantee of the loan portfolio’s principal to mitigate risk, attract investors and support development.
Vietnamese women in Mekong River Delta enjoyed support from USAID
The bond will provide capital to a group of micro-finance institutions and social enterprises that will help low-income women transition from subsistence to sustainable livelihoods and build the women’s resilience to socio-economic stresses. Long-term benefits, in addition to more successful women-owned businesses, include increased participation in the workforce, higher standards of living, and more education and health opportunities for women and children.
“USAID is pleased to be backing the Women’s Livelihood Bond with this loan guarantee. The bond benefits women living in ASEAN states and was put together by an ASEAN-based company”, said Todd Sorenson, Deputy Mission Director at USAID’s Regional Development Mission for Asia in Bangkok.
Sixty percent of the capital for this bond was provided by Asian investors, mostly private banking clients. IIX is planning to develop additional social sustainability bonds in the future.
According to IIX founder Durreen Shahnaz, the bond was supported by public, private, and philanthropic institutions, including DBS Bank Ltd., ANZ Banking Group, the Rockefeller Foundation, the Clinton Global Initiative and Australia’s Department of Foreign Affairs and Trade.
“This brings us one step closer to a day when our financial markets consider social and environmental impact on an equal footing with financial returns”.