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THE GOLDMAN SACHS GROUP, INC.

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Goldman Sachs : World Bank Prices EUR 2 Billion 25-Year Sustainable Development Bond While Highlighting Climate Action

10/14/2021 | 08:34am EST

The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) priced its first Euro-denominated benchmark bond of the 2022 fiscal year with a EUR 2 billion 25-year Sustainable Development Bond maturing in October 2046 - IBRD's first ever EUR Benchmark in the 25-year maturity.

This transaction is part of the World Bank's initiative to issue Sustainable Development Bonds while highlighting the urgency of mainstreaming climate action.

Since announcing the initiative, the World Bank has been engaging with investors to explain how its bonds support the financing of projects that contribute to climate action and how the World Bank's updated Climate Change Action Plan helps countries integrate climate change into their development strategies and apply climate financing in ways that achieve the most positive impact. Applying a 'whole of economy' approach with developing country clients helps the World Bank mainstream climate considerations across its portfolio, including in high emitting sectors as well as sectors not typically associated with climate action such as health, education, and trade. In fiscal year 2021, which ended June 30, 2021, ninety-five percent of all IBRD projects had climate components accounting for 33% of financing.

The bond priced with a final spread to mid-swaps of +12 basis points and an equivalent annual yield of 0.701%. This equates to a spread vs. the reference Bund of +49.9 basis points. Credit Agricole CIB, DZ Bank, Goldman Sachs International, and Natixis are the lead managers for the transaction. The bond will be listed on the Luxembourg Stock Exchange.

'Over the past few weeks, we have been energized by investors' feedback on the World Bank's holistic approach of integrating climate action in every project, from energy to education and are encouraged by investors' efforts to put climate action at the center of their investments and strategies,' said Jingdong Hua, Vice President and Treasurer, World Bank. 'Investors are key to mainstreaming climate action in all investments. Everyone has a role to play to ensure that financing contributes to a better more resilient and sustainable future for all, across all sectors. We thank investors for their support of our first EUR benchmark in the 25-year tenor and our first benchmark since launching this initiative.'

Investor Distribution

By Geography

By Investor Type

Germany

42%

Asset Managers/Insurance/Pension Funds

66%

France

24%

Banks/Bank Treasuries/Corporates

32%

Rest of Europe

29%

Central Banks/Official Institutions

2%

Other

5%

Lead Manager Quotes

'With this new 25-year Sustainable Development Bond, IBRD completes its EUR curve at the long end and takes advantage of supportive market conditions and investors' appetite for duration in the current backdrop of increased yields. Coming on the back of the recent initiative launched by the World Bank to raise awareness for the urgency to integrate climate change considerations in all activities and decisions, it underscores its holistic approach towards climate financing and demonstrates a strong response from the investor community. CACIB is delighted to have been associated with this new very successful endeavour,' said Eric Busnel, Managing Director, SSA Debt Capital Markets, Credit Agricole CIB.

'IBRD has reacted swiftly upon favourable market conditions by issuing a new 25-year EUR Sustainable Development Bond in a size of EUR 2 billion. It is the first EUR benchmark transaction of the World Bank in the new fiscal year and we are proud of having been part of this project. Currently, the World Bank is raising awareness about the mainstreaming of climate action in all its activities. We think that this is an extremely important exercise and we are delighted that we have been able to support the World Bank in this initiative,' said Friedrich Luithlen, Head of DCM, DZ BANK.

'The World Bank continues to be a strategic long-dated EUR issuer and today successfully issued a new EUR 2 billion benchmark in the 25-year tenor, thus filling a natural gap in their curve while responding to investor demand. Achieving a final orderbook of EUR 2.65 billion, the World Bank once again demonstrates the strength of its investor following and confirms its position as a preeminent issuer in Europe,' said Maud Le Moine, Head of SSA Origination, Goldman Sachs International.

'The World Bank reached yet another success in the European primary market, highlighting their ability to continue to tap this market for jumbo sized issuances across any maturity. Strategically developing its presence in this currency has allowed the World Bank to create a viable market for funding to further its global missions. The use of proceeds from this Sustainable Development Bond and the World Bank's efforts to raise awareness of climate action is of a shared importance to both our institutions for which it was a privilege to be a part of the transaction today,' said Thomas Leocadio, Co-Head Public Sector DCM, Natixis.

Transaction Summary

Issuer:

World Bank (International Bank for Reconstruction and Development, IBRD)

Issuer rating:

Aaa /AAA (Moody's/S&P)

Amount:

EUR 2,000,000,000

Settlement date:

October 22, 2021

Maturity date:

October 22, 2046

Issue price:

99.977%

Issue yield:

0.701% annual

Denomination:

EUR 1,000

Coupon:

0.70% p.a., payable annually

Listing:

Luxembourg Stock Exchange

ISIN:

XS2400299363

Clearing system:

Euroclear/Clearstream

Joint lead managers:

Credit Agricole CIB, DZ Bank, Goldman Sachs International, and Natixis

For more information on the World Bank Group and Climate Action: https://www.worldbank.org/en/topic/climatechange

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. The World Bank Sustainable Development Bond Framework and the information set forth therein are not a part of, or incorporated by reference into, the offering documentation.

Contact

Heike Reichelt, Head of Investor Relations and Sustainable Finance

World Bank Treasury

debtsecurities@worldbank.org

(C) 2021 Electronic News Publishing, source ENP Newswire

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Sales 2021 58 852 M - -
Net income 2021 21 432 M - -
Net Debt 2021 302 B - -
P/E ratio 2021 6,36x
Yield 2021 1,74%
Capitalization 126 B 126 B -
EV / Sales 2021 7,27x
EV / Sales 2022 9,29x
Nbr of Employees 43 000
Free-Float 36,7%
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David Michael Solomon Chairman & Chief Executive Officer
John Edward Waldron President & Chief Operating Officer
Stephen M. Scherr Chief Financial Officer & Executive Vice President
Marco Argenti Co-Chief Information Officer
George C. Lee Co-Chief Information Officer
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