The Inter-American Development Bank today announced that it is preparing to launch a new short-term borrowing instrument in the form of a Discount Note Program. The three dealers appointed to arrange the program are Credit Suisse First Boston (CSFB) , Lehman Brothers and Merrill Lynch GSI.
The dealers will assist the Bank with developing the program for sales of short-term securities in the United States and international money markets. The Bank expects the program to be implemented within the next few weeks.
The Bank will offer the notes for sale on a continuous basis through its dealers in maturities of up to one year. The program is authorized with a limit of US$5 billion. However, it is expected that the issuing volume will be initially considerably smaller.
"We think that adding a short-term funding instrument to the Bank's medium- and long-term securities will be helpful in many ways," says Stephen Abrahams, chief of the Bank's Capital Markets Division. "We will improve the cash management of the Bank and provide investors with an attractive alternative in the discount note market. It is a really useful tool to manage the day-to-day fluctuations in the Bank's cash flows and will give us much needed flexibility to handle disbursements."