The African Development Bank has successfully launched an AUD 155 million 10.5-year Kangaroo Social Bond, due October 2032, marking its first social bond transaction of the year. The bond was launched on Thursday 14 April.
The transaction was arranged by Daiwa Capital Markets Europe Limited, who acted as a sole lead manager. This is the Bank's second social bond in the Australian dollar market, following an inaugural AUD Social Kangaroo issued in June 2021, and the first AUD Social Kangaroo exclusively issued to institutional investors in Japan. Two Japanese insurance companies, Meiji Yasuda Life Insurance Company, and Asahi Mutual Life Insurance Company, participated in the deal.
Africa is an importer of food from both Ukraine and Russia, especially wheat and maize, and the current geopolitical instability has led to a worsening of the food situation on the continent. Combined with the rise in energy prices, this is especially distressing for the continent's most vulnerable communities.
By issuing social bonds to finance socio-economic development in its regional member countries, the Bank is advancing its mission and strategy to spur sustainable economic development and social progress in Africa. It is also capitalizing on its track record of financing projects with strong social impact on the African continent.
Proceeds from the Bank's social bonds are allocated to eligible projects that will have significant social impact and outcomes, leading to poverty reduction and inclusive growth in Africa. This is expected to bring socio-economic development and empowerment including solving food insecurity, improving access to basic infrastructure (electricity, water and sanitation, transportation), basic services (medical, education, vocational training), financial services, and job creation.
The Australian dollar is the fifth currency in which the African Development Bank has issued social bonds since the establishment of its Social Bond Program in 2017. It follows successful deals denominated in Euros, US dollars, Norwegian kroner and Swedish kronor. The success of this AUD transaction is reflective of the Bank's solid social bond framework and the high quality of its impact reporting.
