IDB Invest launches $1 billion inaugural sustainability benchmark bond

  • The bond proceeds will finance eligible green and social projects as set out in its new Sustainable Debt Framework supporting IDB Invest’s strategy to reignite growth through the private sector in Latin America and the Caribbean

IDB Invest, the IDB Group’s private sector institution rated Aa1/AA/AAA, raised $1 billion in funding through a 5-year fixed rate benchmark issue to support its strategy to reignite growth in Latin America and the Caribbean. This was IDB Invest’s inaugural benchmark issued under its newly released Sustainable Debt Framework, the first ICMA-aligned Sustainability Debt Framework from a high-grade multilateral development bank.

The five-year bond pays an annual coupon of 0.625% and priced at mid-swaps plus 13 basis points, equivalent to 25 basis points above the 5-year U.S. Treasury bond. Credit Agricole CIB was the Sole Sustainability Advisor and BNP Paribas, Citigroup, Credit Agricole CIB and Goldman Sachs acted as joint bookrunners on the deal.

The transaction experienced strong demand with 45 investors across the globe participating and orders totaling more than 1.46 billion, the largest orderbook for an IDB Invest bond to date. The high level of demand reflects investors’ interest in IDB Invest’s sustainable development mission, strong credit profile and its Sustainable Debt Framework.

Central banks and official institutions took the lion share of the allocations at 74%, followed by fund managers (12%), bank/private banks (9%), other accounts (3%) and insurance/pension accounts (2%). The investor base was very well diversified geographically, with EMEA making up 56% of the demand, Americas 24% and Asia 20%.

The net proceeds of the Sustainable Debt Bond issued under the Sustainable Debt Framework will be used to finance eligible green and social projects as defined in the issuer's Sustainable Debt Framework.

Investor Distribution

Distribution by Geography

%

Distribution by Investor Type

%

EMEA

56

Central Banks / Official Institutions

74

Americas

24

Fund Managers

12

Asia

20

Banks / Private Banks

9

 

 

Others

3

 

 

Insurance / Pension

2

 

Transaction Summary

Issuer:

Inter-American Investment Corporation (IDB Invest)

Issuer rating:

Aa1/AA/AAA (Moody's/S&P/Fitch) (stable/positive/negative)

Format:

Reg S

Amount:

USD 1 billion

Settlement date:

February 10, 2021

Coupon:

0.625% p.a.

Maturity date:

February 10, 2026

Issue price:

99.592%

Issue yield:

0.707%s.a. / 0.708% ann.

Listing:

London Stock Exchange

Clearing systems:

Euroclear and Clearstream

Joint lead managers:

BNP Paribas, Citigroup, Credit Agricole CIB and Goldman Sachs

 

About IDB Invest

IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

Information on IDB Invest bonds is available at https://idbinvest.org/en/investors