ADB raises $4 B from bond market

MANILA, Philippines -  The Asian Development Bank (ADB) issued $4 billion worth of bonds, marking its return to the US dollar bond market.

In a statement Thursday, ADB said the three-year bonds, with a coupon rate of 1.625 percent per annum, would mature on May 5, 2020.

ADB treasurer Pierre Van Peteghem said the bond issuance was a record-breaking transaction for the group.

“This transaction breaks our previous record for the largest-ever dollar global benchmark issue from February, when we issued a $3.75-billion five-year, and sends a very strong message to our stakeholders ahead of ADB’s 50th Annual Meeting in Yokohama next week,” Van Peteghem said.

“The market tone felt extremely constructive in the run up to the Japanese Golden Week holidays and I am delighted to see such a strong reception from investors for ADB’s credit and mission,” he added.

ADB said the bonds were priced at 99.776 percent to yield 23.2 basis points over the 1.5 percent US Treasury notes due April 2020.

BMO Capital Markets, Citi, Deutsche Bank and RBC Capital Markets were the lead mangers of the bonds.

“A syndicate group was also formed consisting of BNP Paribas, CACIB, Daiwa Securities, HSBC, ING, J.P. Morgan, Mizuho International, Nomura, TD Securities and Wells Fargo,” ADB said.

According to the ADB, the issue achieved wide primary market distribution with 34 percent of the bonds placed in Asia, 32 percent in Europe, Middle East and Africa, and 34 percent in the Americas.

“By investor type, 59 percent of the bonds went to central banks and official institutions, 16 percent to banks and 25 percent to fund managers and other types of investors,” ADB said.

ADB is looking to raise around $25-30 billion from the capital markets in 2017.