0.875% US$ 1.0 Billion Benchmark due 15 May 2017

7 March 2014
Content from a Premium Partner
African Development Bank (Abidjan)
press release

Issuer: African Development Bank (AfDB)

Rating: Aaa (Moody's) / AAA (S&P) / AAA (Fitch)

Issue amount: USD 1.0 billion

Pricing Date: 05 March 2014

Settlement Date: 12 March 2014 (T+5)

Coupon: 0.875% (semi-annual)

Maturity:15 May 2017

Reoffer Price: 99.866%

Reoffer Yield: 0.918% (semi-annual)

Re-offer vs. Mid-Swaps: + 1.0 bp

Re-offer vs Benchmark: 0.625% February 2017 +22.85 bp

Lead Manager: Barclays, Deutsche Bank, Morgan Stanley, TD Securities

Transaction Highlights

African Development Bank (AfDB), rated Aaa (Stable) / AAA (Stable) / AAA (Stable (Moody's / Fitch / S&P), has successfully priced a USD 1 billion 3-year USD Global benchmark due on May 15, 2017 through Barclays, Deutsche Bank, Morgan Stanley and TD Securities. The deal pays a coupon of 0.875%. This transaction is AfDB's first USD Global outing of 2014.

The transaction was announced on Tuesday, March 4, 2014 at 3:30 p.m. London time with initial price thoughts of mid-swaps +3 basis points area.

Indications of interest reached USD 1.5 billion overnight, which enabled the issuer to tighten price guidance to mid-swaps +2 basis points area when opening books at 8:00 a.m. the following day. The order book grew extremely quickly, approaching USD 2 billion after only 1.5 hours of book building with little spread sensitivity.

Given AfDB's strong liquidity position, the deal size was capped at a maximum of USD 1 billion from the outset. Consequently, the decision was taken to close the order book at 12:00 p.m. London time when it stood at USD 2 billion, which was well ahead of the originally anticipated schedule.

The strength of the order book allowed the leads to price AfDB's new benchmark at mid-swaps +1 basis points (equivalent to UST +22.85 basis points), the tight end of the original price guidance and inside their existing 1.125% March 2017.

Distribution Statistics

Over 50 investors participated in the transaction, with participation from European investors (37%) setting a new high for AfDB. Final distribution figures highlight AfDB's strong penetration across different regions. The order book was well diversified geographically with high quality orders from Central Banks and Official Institutions (67%) taking the bulk of the transaction.

Read the original article on African Development Bank (AfDB).

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