IDB launches C$500 Million 5-year Sustainable Development Bond

The Inter-American Development Bank (“IDB” or “IADB”), rated Aaa/AAA (Moody’s/S&P), priced a new C$500 million 5-year CAD Sustainable Development Bond (“SDB”).

The transaction in Canadian dollars pays a semi-annual coupon of 4.600% and matures on the 1st of March 2029. It was priced at +30 basis points to CORRA mid-swaps, which equates to +32.6 basis points over the 3.250% CAN due September 2028 and carries a semi-annual yield of 4.603%.

The transaction marks IDB’s second SDB CAD benchmark issuance in 2023 and further builds on a robust presence in the Canadian dollar maple market.

The success of the transaction was underpinned by IDB’s high credit quality and garnered strong support from the global investor community. Not only was the orderbook well supported by Central Banks and Official Institutions, but IDB benefited from the support of a broad group of asset managers which helped expand its reach within the domestic CAD market.

The proceeds of the bond will finance eligible projects under IDB’s Sustainable Development Bond Framework, including social inclusion and equity, productivity and innovation, economic integration, climate change and environmental sustainability, gender equality and diversity and institutional capacity and rule of law.

The transaction attracted orders over 700 million Canadian dollars, generating strong interest from a broad range of investors from around the world, including central banks, official institutions, bank treasuries and asset managers.

“It is great to see strong investor support for our second CAD Sustainable Development Bond this year,” said Laura Fan, head of funding at the IDB. “This issuance extended our curve, and it demonstrates our ongoing commitment as a regular issuer in the CAD market. We hope to further increase our presence in the market, in part, by adding new maturities and/or tapping outstanding bonds in the upcoming year.”

Investor Distribution:

Bond Summary Terms:

Joint Lead Manager Quotes: 

"The Inter-American Development Bank’s successful return to Canadian Dollar market was well-received by both domestic and international investors alike, allowing the issuer to price an over-subscribed C$500MM transaction amid a volatile market backdrop and busy CAD pipeline. Their thoughtful approach to navigating the market was rewarded with a high-quality and global orderbook which saw strong interest from Bank Treasuries, Central Banks and a number of notably rare domestic real money investors. Congratulations to the IDB team on a very successful transaction!." Sean Hayes, Managing Director and Head of US Syndicate, BMO Capital Markets

“For its second visit to Canadian debt markets this calendar year, IDB was once again met by strong appetite for its Sustainable Development Bonds, confirming its status as a leading issuer in the Maple market. IDB’s Sustainable Development Bond program also allows Canadian investors to participate in IDB’s sustainability ambitions, which CIBC is committed to support.” Priya Radha, Managing Director & Global Head, Government Solutions, CIBC Capital Markets

“IDB capitalized on the international demand in the Canadian Dollar market by demonstrating leadership with a highly successful C$500mm long 5yr Sustainable Development bond. The high-quality demand speaks to the continued investor appetite for the high quality IDB credit. NBF was extremely pleased to partner with IDB in continuing to develop the Canadian SSA market. The transaction marks IDB’s second SDB CAD benchmark issuance in 2023 and further builds on a robust presence in the Canadian dollar maple market.” Scott Graham, Head and Managing Director, US Government and SSA Finance, National Bank of Canada Financial Markets

Information on bonds for Investors is available on the IDB website: https://www.iadb.org/investors

*This press release is not an offer for sale of the securities of the Inter-American Development Bank. Any offering of IDB securities will be made only by means of a prospectus or other definitive offering document that contains important information about the securities, the offering and IDB. Offerings of securities will be made only in compliance with applicable laws.