The International Development Association (IDA) On Monday launched its first bond in its nearly 60-year history, as investors around the globe seized the opportunity to invest in a triple A-rated asset and support life-changing investments in the world’s poorest countries.
The bond, which marks the launch of IDA’s borrowing programme in the global capital markets, raised US$1.5 billion to address some of the most pressing development issues.
IDA provides technical expertise and low-cost financing for projects and programmes that boost economic growth and reduce poverty in the world’s poorest countries— from tackling conflict, fragility and violence; forced displacement; climate change; and gender inequality to promoting governance, institution building, creating jobs and supporting a strong private sector for economic transformation.
Until now, IDA has been virtually unleveraged, building up an unparalleled equity base of US$158 billion.
In 2016, IDA shareholders agreed to transform IDA’s financing model, leveraging its strong capital base to pioneer a new model for development finance that combines donor funding with funding raised in the capital markets. IDA’s borrowing program will enable IDA to significantly scale up its support toward achieving the Sustainable Development Goals, while offering investors an efficient way to contribute to global development.
“Today’s bond issue will allow IDA to tap into the power of capital markets to tackle some of the world’s biggest challenges and help millions lift themselves out of poverty,” World Bank Group President, Jim Yong Kim said.
Also, the World Bank Vice President and Treasurer, Arunma Oteh said: “IDA received a resounding response from the market for its debut issuance. Investors globally seized the unique opportunity to be the first to invest in IDA’s triple-A rated bond and make a positive impact in the lives of hundreds of millions of people around the globe.
“I want to thank investors, lead managers and all the bankers for their personal engagement and commitment to making IDA debut such a fantastic success.”