News

IDB issues a new 5-year fixed-rate global benchmark transaction

The Inter-American Development Bank (“IDB” or “IADB”), rated Aaa/AAA (Moody’s/S&P), priced a new $ 4.25 billion 5-year fixed-rate global benchmark.

The transaction pays a semi-annual coupon of 0.875% and matures on April 20, 2026. It was priced with a spread of 10.5 basis points over the 0.750% UST due 31 March 2026, which translates to a semi-annual yield of 0.969%.

The transaction is IDB’s second benchmark of 2021 across all currencies and represents IDB’s first 5-year benchmark in over a year. At $ 4.25 billion, the trade stands as IDB’s largest-ever USD 5-year fixed-rate benchmark.

“Favorable market conditions generated strong investor interest for our second foray in the USD global benchmark market.  The high-quality order book allowed us to print our largest ever 5-year USD global benchmark.  We are pleased with the excellent outcome!” said Laura Fan, Head of Funding at the IDB.

Investor Distribution:

Geographic Region         

Investor Type

Americas

36%

 

Central Banks / Official Institutions

43%

Asia-Pacific

33%

 

Fund Managers / Corporates

27%

EMEA

31%

 

Banks / Private Banks

26%

 

 

 

Insurance / Pension

4%

 

Bond Summary Terms:

Issuer:

Inter-American Development Bank (Ticker: IADB)

Issuer rating:

Aaa / AAA (Moody’s / S&P)

Amount:

USD 4.25 billion

Settlement date:

20 April 2021 (T+5)

Coupon:

Coupon payment dates:

0.875%

20 October and 20 April

Maturity date:

20 April 2026

Issue price:

99.542%

Issue yield:

0.969% s.a.

Reoffer spread (bps):

Mid Swaps +0 / CT5 +10.5bps

Listing:

London Stock Exchange

Clearing systems:

Fedwire, Euroclear, Clearstream

Joint lead managers:

BNP Paribas / Goldman Sachs International / J.P. Morgan / Morgan Stanley

ISIN / CUSIP:

US4581X0DV77 / 4581X0DV7

 

Joint Lead Manager Quotes:

“Huge congratulations to the IDB team for issuing their largest ever 5-year transaction amid an extremely busy period in primary markets. Their timing allowed the team to capture both tight pricing and significant size for their second fixed-rate benchmark of 2021. This transaction proves again the broad following the issuer has developed across high-quality investors globally from Central Banks, Official Institutions, Treasuries and Asset Managers.” Robert Matthews, SSA DCM at BNP Paribas.

“This transaction exceeded expectations and yielded a spectacular result for IDB. Taking advantage of strong market conditions at the beginning of Q2, IDB managed to achieve their largest benchmark in 5yr at $4.25bn, while also printing the tightest transaction in that maturity in the SSA space since 2015. Many congratulations to the IDB team for their impeccable timing and market read, allowing them to achieve such a fantastic trade.” Maud Le Moine, Head of SSA DCM at Goldman Sachs.

“IDB seized the clear issuance window and supportive market conditions amid the post-Easter funding wave to bring an impressive $4.25bn 5-year global benchmark at mid-swap flat – the tightest 5-year reoffer mid-swap spread for any SSA issuer since 2015.  The high quality and diversity of the order book is a testament to the issuer’s solid credit quality and name recognition globally.  J.P. Morgan is delighted to have been involved in the transaction!” Keith Price, Head of Frequent Borrower Group, J.P. Morgan.

"A truly remarkable result for the IDB with this foray in the USD benchmark market, having achieved the tightest priced 5-year benchmark in six years. The size achieved is also truly impressive, matching the largest ever 5-year printed by IDB. An all-round fantastic outcome for the issuer, which propels them ahead in the completion of their funding program for the year.” Ben Adubi, Head of SSA Syndicate at Morgan Stanley.

About the IDB

The Inter-American Development Bank is a leading source of long-term financing for economic, social and institutional projects in Latin America and the Caribbean. Besides loans, grants and guarantees, the IDB conducts cutting-edge research to offer innovative and sustainable solutions to our region’s most pressing challenges. Founded in 1959 to help accelerate progress in its developing member countries, the IDB continues to work every day to improve lives.

*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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