ADB sells USD5.5 billion dual tranche 3- and 10-year global benchmark bonds
Saturday, 07/01/2023 11:00 (GMT+7)
(CPV) - On January 5th 2023, the Asian Development Bank (ADB) priced a 3-year global benchmark United States (US) dollar bond worth USD3.5 billion and a 10-year global benchmark US dollar bond worth USD2 billion, proceeds of which will be part of ADB’s ordinary capital resources used to support development across Asia and the Pacific.
“We appreciate the strong support from our investors across regions in our first global benchmark outing of the year,” said ADB Treasurer Pierre Van Peteghem. “With an orderbook of over USD13 billion, we raised $5.5 billion across the two tranches, providing ADB with additional resources as we help our developing member countries tackle challenges, including recovery from the pandemic, food security, and climate change.”
The 3-year bond, with a coupon rate of 4.25% per annum payable semi-annually and a maturity date of 9 January 2026, was priced at 99.720% to yield 14.1 basis points over the 4% US Treasury notes due December 2025.
The 10-year bond, with a coupon rate of 4% per annum payable semi-annually and a maturity date of 12 January 2033, was priced at 99.812% to yield 28.625 basis points over the 4.125% US Treasury notes due November 2032.
The transaction was lead-managed by Citigroup Global Markets, Nomura, RBC Capital Markets, and TD Securities. A syndicate group was also formed consisting of CIBC Capital Markets, DBS Bank, ING Bank, and Scotiabank.
Both tranches achieved wide primary market distribution. On the 3-year issue, 45% of the bonds were placed in Europe, Middle East, and Africa; 43% in the Americas; and 12% in Asia. By investor type, 47% of the bonds went to central banks and official institutions, 34% to banks, and 19% to fund managers and other types of investors. On the 10-year issue, 66% of the bonds were placed in Europe, Middle East, and Africa; 25% in the Americas; and 9% in Asia. By investor type, 47% of the bonds went to banks, 21% to central banks and official institutions, and 32% to fund managers and other types of investors.
ADB plans to raise about USD31 billion–USD33 billion from capital markets in 2023./.