AfDB launches 3-year social bond at $ 2 bn

25 / 01 / 2024

By Marwa Nassar - -

The African Development Bank (AfDB) has launched its first social bond in 2024 at $ 2 billion under its new Sustainable Bond Framework, established in September 2023.

The three-year bond is the bank’s first global benchmark of the year, strategically aligning with the robust reopening of primary markets in January 2024. This issuance is a significant highlight amid a dynamic week in the USD SSA markets, witnessing the launch of 8 benchmarks totaling $ 17.25 billion within a span of two days.

The Sustainable Bond Program seamlessly consolidates and enhances the African Development Bank’s existing Green and Social Bond programs, facilitating the issuance of green bonds, social bonds, and sustainability bonds.

With this transaction, the African Development Bank continues to carry out its funding strategy of issuing large liquid benchmark transactions and adds another on-the-run reference in the 3-year maturity. The Bank was able to successfully secure the tightest pricing among Multilateral Development Banks (MDBs) both versus swaps and US Treasuries.

The issuance received strong support from the global investor community, with an order book in excess of $ 3.5 billion and attracted high-quality investors, including central banks, official institutions, and bank treasuries, constituting 78% of the book. Distribution was well diversified across geographies and investor profiles, with 76 orders in the book.

The social label garnered interest from ESG investors, representing 38% of participants in the book.