ADB sells $4.5b 5-year global benchmark bond

Diplomatic Correspondent

29 January, 2021 12:00 AM printer

The Asian Development Bank (ADB) priced a $4.5 billion 5-year global bond, proceeds of which will be part of ADB’s ordinary capital resources.

“The dollar market has seen a very active start to the new year,” said ADB Treasurer Pierre Van Peteghem.

“ADB is very pleased with the strong reception to our first outing in 2021 which allowed us to issue $4.5 billion in the 5-year maturity. This issuance will support the much-needed assistance that we provide to our borrowers through this global pandemic,” he added. The 5-year bond, with a coupon rate of 0.5% per annum payable semi-annually and a maturity date of  February 4, 2026, was priced at 99.759% to yield 14.43 basis points over the 0.375% US Treasury notes due January 2026, said a press release of ADB issued in Manila on Thursday.

The transaction was lead-managed by Bank of America Securities, Citi, HSBC, and Morgan Stanley. A syndicate group was also formed consisting of Daiwa Capital Markets, Danske Bank, Mizuho Securities, Natwest Markets, and Swedbank. The issue achieved wide primary market distribution with 38% of the bonds placed in Asia; 32% in Europe, Middle East, and Africa; and 30% in the Americas. By investor type, 52% of the bonds went to central banks and official institutions, 33% to banks, and 15% to fund managers and other types of investors.

ADB plans to raise around $30 billion–$35 billion from the capital markets in 2021.