Asian Development Bank sells USD3.5 billion 5-year global benchmark bond

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

The Asian Development Bank (ADB) returned to the US dollar bond market with the pricing of a $3.5 billion 5-year global benchmark bond issue, proceeds of which will be part of ADB's ordinary capital resources.

"The transaction was our first global benchmark outing of the year and the timing pleased our investor base," said ADB Treasurer Mr Pierre Van Peteghem. "We watched as the first wave of sovereigns, supranational, 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 order book that held together at the tightest pricing for a USD 5-year global benchmark bond so far in 2019."

The 5-year bond, with a coupon rate of 2.625% per annum payable semi-annually and a maturity date of 30 January 2024, was priced at 99.498% to yield 14.9 basis points over the 2.625% US Treasury notes due December 2023.

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.

With over 80 investors taking part, the issue achieved wide primary market distribution with 44% of the bonds placed in Asia; 41% in Europe, Middle East, and Africa; and 15% in the Americas. By investor type, 54% of the bonds went to central banks and official institutions, 36% to banks, and 10% to fund managers and other types of investors.

ADB plans to raise around $23 billion from the capital markets in 2019.