ADB raises $3 billion from bond issue

MANILA, Philippines — Manila-based Asian Development Bank (ADB) has raised $3 billion from a three-year dollar bond issuance, proceeds of which will form part of the bank‘s ordinary capital resources.

ADB’s latest global benchmark bond issue is in line with its goal of raising $34 billion to $36 billion from the capital markets this year.

Most of ADB’s lending comes from its ordinary capital resources, offered at near-market terms to lower- to middle-income countries like the Philippines.

The three-year bond has a coupon rate of 0.625 percent per annum payable semi-annually and a maturity date of Oct. 8, 2024. It was priced at 99.94 percent to yield 9.1 basis points over the 0.375 percent US Treasury notes due September 2024.

“Given the robust order book in excess of $6.6 billion, final pricing was set two basis points inside initial price thoughts with a print size of $3 billion that was in line with our remaining funding requirement from the US dollar global market for 2021,” ADB treasurer Pierre Van Peteghem said.

“Investor interest in our good work was as ever impressive, particularly amid lingering concerns over the COVID-19 pandemic,” he said.

The transaction was managed by BofA Securities Inc., Morgan Stanley, Nomura Holdings Inc. and RBC Capital Markets. A syndicate group was also formed consisting of BNP Paribas S.A., CIBC World Markets Inc., Scotiabank and SEB.

The three-year issue achieved wide primary market distribution with 44 percent in Europe, Middle East, and Africa, 36 percent of the bonds placed in the Americas and 20 percent in Asia.

By investor type, 65 percent of the bonds went to central banks and official institutions, 24 percent to banks, and 11 percent to fund managers and other types of investors.