WASHINGTON, D.C., October 24, 2023 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) issued the first digital securities on a new Digital Financial Market Infrastructure (D-FMI) distributed ledger technology platform developed by Euroclear (Digitally Native Notes). The 3-year Digitally Native Notes raised EUR 100 million to support the financing of World Bank’s sustainable development activities.
Powered by distributed ledger technology (DLT), Euroclear’s D-FMI enables the creation, issuance, and settlement of fully digital international securities. The securities are governed by English law. Digitization has the potential to improve transparency, increase efficiency, and reduce operational risks and costs in securities processing. By connecting to Euroclear’s traditional settlement platform for secondary market operations, investors can have full access to all Euroclear System core and ancillary added-value services.
“The World Bank’s issuance of the first blockchain bond “bond-i” a few years ago was an innovative first step toward using DLT for bond issuance. This inaugural issuance in partnership with Euroclear, TD Securities and Citibank on Euroclear’s digital platform now presents a transformational opportunity to expand digitization in the capital markets,” said Anshula Kant, Managing Director and Chief Financial Officer, World Bank Group. “This collaboration is a milestone in our efforts to create scalable, transparent, and efficient markets for our member countries.”
“Today's launch marks a significant stride towards the digital evolution of our financial markets and unlocking the vast potential of digital assets,” said Lieve Mostrey, CEO of Euroclear Group. “Our strategic alliances with the World Bank, TD Securities and Citi played a pivotal role in bringing this innovation to the market, underscoring the transformative impact that true collaboration can have in the financial industry. We will continue to advance pioneering solutions, united by our joint commitment to empowering issuers and investors, elevating market transparency and fostering growth and stability.”
TD Securities was the dealer for the transaction and Citibank was the paying and issuer agent. Investors from North America and Europe participated in the transaction.
“We are delighted to work with the World Bank and Euroclear on this inaugural issuance,” said Andrew Mulley, EMEA Head of Citi's Issuer Services. “It demonstrates the continued value of the international issuance model and its potential to transform the way in which debt capital markets operate. We are committed to continue our engagement with clients and partners to provide innovative solutions and thought leadership that meets their changing needs.”
"TD Securities is delighted to have acted in partnership with Euroclear, the World Bank and Citi as the issuer agent on this transaction, which marks another crucial milestone on the path to revolutionise and digitize global capital markets. The World Bank continues to demonstrate their commitment to innovation in financial markets and once again takes a leading role with this trade,” said Riaz Ahmed, President and CEO of TD Securities. “We are pleased to work alongside Euroclear, the World Bank and Citi as the issuer agent and we look forward to seeing how increasing utilisation of DLT technologies in capital markets will deliver opportunities that will benefit all market participants."
“Union Investment as a leading European asset manager is honoured to have participated in this pioneer Digitally Native Note with the highly regarded and innovative issuer World Bank in close cooperation with Euroclear and TD Securities,” said one of the investors, Christoph Hock, Director and Head of Multi-Asset Trading, Union Investment. “This transaction is an important step in the adoption of innovative distributed ledger technology. Token economy and digital assets are key elements of our approach to digitalisation, which has the potential to act as a game changer for the financial industry. Our focus is on assets on chain and on cash on chain with clients, products, and processes.”
Transaction Summary
Issuer: | World Bank (International Bank for Reconstruction and Development, IBRD) |
Issuer rating: | Aaa /AAA (Moody's/S&P) |
Amount: | EUR 100 million |
Settlement date: | 23 October 2023 |
Maturity date: | 23 October 2026 |
Issue price: | 100% |
Issue yield: | 3.399% annually |
Denomination: | EUR 1,000 and integral multiples thereof |
Coupon: | 3.399% per annum |
Listing: | Luxembourg Stock Exchange |
ISIN: | XS2615318289 |
Clearing system: | Following the issuance, creation and primary distribution of the Digitally Native Notes on Euroclear’s D-FMI, the Digitally Native Notes will be immobilized on the D-FMI and immediately made available within the Euroclear Legacy Component. |
Dealer: | TD Securities |
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.
About Euroclear
Euroclear group is the financial industry’s trusted provider of post trade services. Guided by its purpose, Euroclear innovates to bring safety, efficiency and connections to financial markets for sustainable economic growth. Euroclear provides settlement and custody of domestic and cross-border securities for bonds, equities and derivatives, and investment funds. As a proven, resilient capital market infrastructure, Euroclear is committed to delivering risk-mitigation, automation and efficiency at scale for its global client franchise. The Euroclear group comprises Euroclear Bank, the International CSD, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden, Euroclear UK & International and MFEX by Euroclear.
Disclaimers
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.
Net proceeds of the bonds described herein are not committed or earmarked for lending to, or financing of, any particular projects or programs. Payments on the bonds described herein are not funded by any particular project or program.
Contacts
Heike Reichelt, The World Bank
+1 202 477 2880
debtsecurities@worldbank.org
Craig MacDonald, Euroclear
+44 207 849 0315
craig.macdonald@euroclear.com
