AfDB says $1b bond deal makes successful showing

The African Development Bank (AfDB) on January 11, 2012 successfully issued a $1 billion, five-year bond as well as order books totalling $1.2 billion from 43 investors.

According to the AfDB, the order book was well diversified geographically. “Asian investors came in as the largest buyers at 44% of the bond; European and American investors bought 18%, while African and Middle East investors bought 15% and 5% respectively.”

The African lender said the 43 accounts included high quality orders from central banks and official institutions, which bought 68% of the deal, while banks bought 17% and asset managers 15%.

“Transaction activity grew rapidly, with the orderbook soon reaching over $900 million. Given AfDB’s strong liquidity position, the deal size was capped at a maximum of $1 billion from the outset. The decision was thus taken to close the orderbook at 4pm London time when it reached $1.2 billion with over 40 orders,” the AfDB said in a statement January 18, 2012.

“The transaction again highlights the strong support African Development Bank enjoys from the investor community for its development mandate in Africa,” said AfDB Group Treasurer Pierre Van Peteghem given the background of the global financial crisis.

The lead managers of the bond which matures in just over five years on March 15, 2017 are Daiwa Capital Markets, Goldman Sachs International, HSBC and J.P. Morgan.

The AfDB is a triple-A rated institution by the international ratings agencies Moodys, Fitch and Standard & Poor’s.

By Ekow Quandzie