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IDB issues its largest ever 10-year fixed-rate global Sustainable Development Bond

The Inter-American Development Bank (“IDB” or “IADB”), rated Aaa/AAA (Moody’s/S&P), priced a new $4 billion 10-year fixed-rate global benchmark.

The transaction pays a semi-annual coupon of 1.125% and matures on January 13, 2031. It was priced with a spread of 13.65 basis points over the 0.875% UST due November 15, 2030, which translates to a semi-annual yield of 1.181 %.

The transaction is IDB’s first benchmark of 2021 across all currencies and represents IDB’s first 10-year benchmark in over a year. At $4 billion, the trade stands as IDB’s largest-ever USD 10-year fixed-rate benchmark.

“We are thrilled to start the new year with our largest ever 10-year USD global benchmark. The higher than expected investor demand propelled us to the $4 billion size which is double our originally envisioned $2 billion. The lack of long-dated USD SSA supply, higher yields as well as the Sustainable Development Bond format contributed to the resounding success,” said Laura Fan, Head of Funding at the IDB.

Investor Distribution:

Geographic Region Investor Type
Asia-Pacific 47% Central Banks / Official Institutions 52%
EMEA 33% Banks/Private Banks 29%
Americas 20% Fund Managers/Corporates 18%
    Insurance/Pension 2%

Bond Summary Terms:

Issuer Inter-American Development Bank (Ticker: IADB)
Issuer rating Aaa / AAA (Moody’s / S&P)
Amount USD 4 billion
Settlement date 13 January 2021 (T+5)
Coupon 1.125%
Coupon payment dates 13 July and 13 January
Maturity date 13 January 2031
Issue price 99.473%
Issue yield 1.181% s.a.
Reoffer spread (bps) Mid Swaps +15 / CT10 +13.65
Listing London Stock Exchange
Clearing systems Fedwire, Euroclear, Clearstream
Joint lead managers BMO Capital Markets / BofA / Deutsche Bank / TD Securities
ISIN / CUSIP US4581X0DS49 / 4581X0DS4

Joint Lead Manager Quotes:

“Responding to investors' bid for duration and incremental yield, IDB kicked-off the new year by reopening the 10-year maturity in impressive fashion. The transaction attracted tremendous support from over 100 buyers, paving the way for IDB to print its largest 10-year benchmark ever, while pricing at the tightest re-offer spread to mid-swaps since IDB’s last 10-year issuance. As the first 10-year USD SSA deal of 2021, this offering sets the bar high for others looking to follow,” said Sean Hayes, Managing Director & Head of US Syndicate & Credit Sales, BMO Capital Markets.

"Congratulations to the IDB team, who at USD 4 billion have issued their largest 10yr transaction to date. Their timing was excellent in the context of a rising treasury yield environment and was rewarded with exceptionally high-quality investor interest. This line will provide a valuable long-dated, liquid reference point to their USD curve for many years to come," said Adrien de Naurois, SSA Syndicate, Bank of America.

“We congratulate the IDB team for beginning the 2021 funding programme with their largest 10-year USD Global Benchmark in history. Following a back-up in USD rates, this Sustainable Development bond attracted high-quality demand from a broad range of investors, particularly the central bank community. This transaction is a remarkable return for IDB to the 10-year part of the curve,” said Laura O'Connor, Managing Director, Fixed Income Origination & Syndication, TD Securities.

“An exceptional outcome for the IDB on its return to the 10-year part of the curve. Again, the IDB has shown its agility in taking advantage of conducive market conditions following the uptick in yields and attractive steepness of the USD SSA ASW curve. The quality and granularity of the order book was exceptional, a true testament to IDB’s broad investor following, despite only a very limited new issue concession. This transaction was a great achievement all around and sets the right tone for IDB’s ambitious USD 25 billion borrowing programme,” said Katrin Wehle, Managing Director, SSA DCM at Deutsche Bank.

About the IDB

The Inter-American Development Bank is a multilateral financial institution supporting Latin America and the Caribbean’s efforts to reduce poverty and inequality, and to bring about development in a sustainable, climate-friendly way. Established in 1959, it is the leading source of development financing for Latin America and the Caribbean, with a strong commitment to achieving measurable results.

For investor information about IDB’s bonds, please visit: http://www.iadb.org/investors

*This press release is not an offer for sale of the securities of the Inter-American Development Bank. Any offering of IDB securities will be made only by means of a prospectus or other definitive offering document that contains important information about the securities, the offering, and IDB. Offerings of securities will be made only in compliance with applicable laws.

Press contact
More Information

Laura Fan
Head of Funding
lauraf@iadb.org
(202) 623 - 3772

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