ADB issues $3.5-billion, five-year global benchmark bonds

The Asian Development Bank has returned to the US dollar bond market with the issuance of $3.5 billion of five-year global bonds.

The proceeds from the issuance will be used to finance the bank’s capital resources.

The five-year bond, with a coupon rate of 2.625 percent per annum payable semi-annually and a maturity date of 30 January 2024, was priced at 99.498 percent to yield 14.9 basis points over the 2.625 percent US Treasury notes due December 2023, the bank said Thursday.

“The transaction was our first global benchmark outing of the year and the timing pleased our investor base,” ADB Treasurer Pierre Van Peteghem said.

“We watched as the first wave of sovereigns, supranationals, and agencies supply was well absorbed by the market and secondary marks tightened steadily reflecting solid performance. ADB’s decision to go out was duly rewarded with a strong orderbook that held together at the tightest pricing for a USD 5-year global benchmark bond so far in 2019,” he added.

ADB said it plans to raise around $23 billion from the capital markets this year.

According to ADB, over 80 investors took part in the issuance, with most or 44 percent of the bonds placed in Asia. Forty-one percent was placed in Europe, Middle East, and Africa, and 15 percent in the Americas.

In terms of investor type, 54 percent of the bonds went to central banks and official institutions, 36 percent to banks, and 10 percent to fund managers and other types of investors.

The transaction was lead-managed by Goldman Sachs International, J.P. Morgan, Mizuho Securities, and RBC Capital Markets.

A syndicate group was also formed consisting of Commerzbank, Danske Bank, Daiwa Capital Markets, Deutsche Bank, and Wells Fargo Securities. —Jon Viktor Cabuenas/VDS, GMA News