WASHINGTON, D.C., July 19, 2021 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) issued a 2-year Sustainable Development Bond raising CNH 500 million (approximately US$ 77 million equivalent) while engaging with investors to raise awareness for the importance of combatting food loss and waste. These challenges are outlined by Sustainable Development Goal 12.3: halving food waste by 2030. The bond was placed with investors committed to highlighting the importance of this theme, with Gavekal Capital Limited as the lead investor. HSBC Bank plc acted as sole lead manager for the transaction.
Jingdong Hua, Vice President and Treasurer, World Bank, said, “Supporting countries to address the climate and social impacts of food loss and waste is a key priority for the World Bank particularly as the COVID pandemic has exposed both supply chain vulnerabilities and may add up to 130 million undernourished people in the world. We thank investors who participated in this transaction, across Asia and Europe, for their support of World Bank bonds and in helping build awareness for the critical need to curb food loss and waste for the benefit of both people and planet.”
Christine Cheung, Head of Asian Fixed Income, Gavekal Capital Limited, said “Since Gavekal started investing in CNH bonds in 2010, the firm noticed that there has been a lack of CNH-denominated ESG-themed bonds, including Sustainable Development Bonds. Given Gavekal’s focus on responsible investment, we are pleased to support the World Bank’s first CNH-denominated Sustainable Development Bond that raises awareness for food waste reduction to maximize the impact of our investment and highlight the importance of combating food loss and waste. We look forward to working with World Bank and other high-quality issuers to print other ESG-themed bonds in the future.”
World Bank bonds support the financing of sustainable development projects and programs in member countries. This includes nearly US$6 billion equivalent in lending commitments to middle-income countries to address food loss and waste, with investments in infrastructure, access to markets and logistics, and waste management. Even before the COVID-19 pandemic disrupted domestic supply chains, causing some farmers to destroy unsold crops, about a third of all food produced annually was lost at the farming, transport and processing stages or wasted at the retail and consumer levels. COVID-19 further revealed the vulnerabilities of populations to undernutrition and food supply chains globally increasing the urgency to tackle food loss and waste.
Reductions in food loss and waste can deliver diverse dividends, including combatting hunger, supporting sustainable food production, diets and consumption, and ultimately in addressing climate change, given that losses and waste generate eight percent of annual global greenhouse gas emissions. A World Bank report, Addressing Food Loss and Waste: A Global Problem with Local Solutions, analyzes the economic drivers, incentives and disincentives around the challenge and highlights steps needed to reduce losses and waste.
Since March 2019, when the World Bank launched the first Sustainable Development Bond to raise awareness for food loss and waste, a range of banks, asset managers, insurance companies and pension funds globally have shown their support. The World Bank has issued almost US$3 billion equivalent in Sustainable Development Bonds for investors interested in highlighting the need to address the challenges of food loss and waste.
Transaction Summary
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
Issuer rating: | Aaa / AAA (Moody's/S&P) |
Currency: | CNH |
Maturity | 2-year |
Amount: | CNH 500,000,000 |
Settlement date: | July 19, 2021 |
Maturity date: | July 19, 2023 |
Issue price: | 100% |
Denominations: | CNH 1,000,000 |
Coupon: | 2.550% per annum |
Listing: | Luxembourg Stock Exchange |
ISIN: | XS2366200850 |
Clearing system: | Euroclear / Clearstream |
Sole lead manager: | HSBC Bank Plc |
About the World Bank
The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody’s/S&P), is an international organization. Created in 1944, it is the original member of the World Bank Group and operates as a global development cooperative owned by 189 nations. The World Bank provides loans, guarantees, risk management products, and advisory services to middle-income and other creditworthy countries to support the Sustainable Development Goals and to end extreme poverty and promote shared prosperity. It also provides leadership to coordinate regional and global responses to development challenges. The World Bank has been issuing sustainable development bonds in the international capital markets for over 70 years to fund programs and activities that achieve a positive impact. More information on World Bank bonds is available at www.worldbank.org/debtsecurities.
World Bank bonds support the financing of programs that further the Sustainable Development Goals (SDGs). World Bank bonds are aligned with the Sustainability Bond Guidelines published by the International Capital Market Association and as such support the financing of a combination of green and social, i.e., “sustainable development” projects, programs and activities in IBRD member countries as described in the World Bank Sustainable Development Bond Framework. The World Bank is also a member of the Executive Committee of the Green Bond, Social Bond, and Sustainability Bond Principles. A key priority for the World Bank’s capital markets’ engagement is building strategic partnerships with investors to promote the importance of private sector financing in sustainable development. The World Bank’s Sustainable Development Bond Impact Report describes how the World Bank engages with investors on the SDGs and raises awareness for specific development challenges.
Disclaimers
Net proceeds of the bonds described herein are not committed or earmarked for lending to, or financing of, any particular projects or programs, and returns on the bonds described herein are not linked to the performance of any particular project or program.”
This press release is not an offer for sale of securities of the International Bank for Reconstruction and Development ("IBRD"), also known in the capital markets as "World Bank". Any offering of World Bank securities will take place solely on the basis of the relevant offering documentation including, but not limited to, the prospectus, term sheet and/or final terms, as applicable, prepared by the World Bank or on behalf of the World Bank, and is subject to restrictions under the laws of several countries. World Bank securities may not be offered or sold except in compliance with all such laws.
Contact
Heike Reichelt
Head of Investor Relations and Sustainable Finance
World Bank Treasury
debtsecurities@worldbank.org
