The Asian Development Bank (ADB) returned to the US dollar bond market with the pricing of a $3.75 billion 5-year global benchmark bond issue, proceeds of which will be part of ADB’s ordinary capital resources.
“This transaction represents a record size for ADB in US dollars and garnered one of our largest-ever levels of subscription for a global benchmark issue allowing for pricing inside of the original guidance. So this is an extremely successful mid-curve outing for us post-Chinese New Year and affirmation from the investor community for our solid credit and mission,” said ADB Treasurer Pierre Van Peteghem.
The 5-year bond, with a coupon rate of 2.000% per annum payable semi-annually and a maturity date of 16 February 2022, was priced at 99.434% to yield 26.95 basis points over the 1.875% US Treasury notes due January 2022.
The transaction was lead-managed by Bank of America Merrill Lynch, HSBC, Morgan Stanley, and TD Securities. A syndicate group was also formed consisting of BMO Capital Markets, BNP Paribas, Citi, Daiwa Securities, DB, DBS Bank, ING, J.P. Morgan, Mizuho International, and RBC Capital Markets.
The issue achieved wide primary market distribution with 32% of the bonds placed in Asia, 39% in Europe, Middle East, and Africa, and 29% in the Americas. By investor type, 44% of the bonds went to central banks and official institutions, 40% to banks, and 16% to fund managers and other types of investors.
ADB plans to raise around $25-30 billion from the capital markets in 2017.
