ADB prices $ 1 b 7-year global bond issue

MANILA, PHILIPPINES: The Asian Development Bank (ADB) returned to the US dollar bond market yesterday with the pricing of a $ 1 billion seven-year global benchmark bond issue. The proceeds of the bond will be part of the bank’s ordinary capital resources and used in its non-concessional operations.

“We are very pleased with the outcome of the transaction and the consistently solid support shown by a diverse set of investors,” said ADB Treasurer Mikio Kashiwagi.

The bonds, with a coupon rate of 1.375% per annum payable semi-annually and a maturity date of 23 March 2020, were priced at 99.888% to yield 17.45 basis points over the 1.125% US Treasury notes due December 2019. The transaction was lead-managed by Goldman Sachs, Morgan Stanley, and RBC Capital Markets. A syndicate group was also formed consisting of BNP Paribas, Citi, Daiwa, SMBC Nikko, and TD Securities. The book achieved broad primary distribution with about 59% of the bonds placed in Asia, 29% in Europe, Middle East and Africa, and 12% in the Americas.  By investor type, around 54% were bought by central banks and official institutions, 27% by fund managers, 18% by banks, and 1% others. ADB plans to raise around $ 14-16 billion from the capital markets in 2013.