This week, the African Development Bank priced a new USD 1 billion 5-year Global benchmark bond. This is AfDB’s second fixed-rate USD transaction of the year after having issued a 5-year in January.
Following the US Federal Reserve’s announcement to continue with loose monetary policy for longer than anticipated and the subsequent stabilization of yields, the AfDB decided to take advantage of a clear issuance window ahead of expected heavy supply with a new 5-year Global benchmark transaction. Final pricing achieved was in the context of midswaps plus 6 basis points.
Final distribution figures underscore AfDB’s diverse investor base across key regions. Investors from the Americas came in as the largest buyers at 39 percent. EMEA and Asian investors bought 35 and 26 percent, respectively.
The 28 accounts involved in the deal included high quality orders from Central Banks and official institutions, which bought 39 percent of the deal, while banks bought 31 percent and asset managers 30 percent.
Joint Lead Managers on the transaction are Citigroup, Goldman Sachs International, HSBC and TD Securities. The bond matures in five years on 2 October 2018.
AfDB is a triple-A rated institution by the international ratings agencies Moody’s, Fitch and Standard & Poor’s. The USD 1 billion Global benchmark transaction demonstrates the Bank’s credibility as an international financial institution.