Global investors welcomed the West African Development Bank’s first bond issue with sustainable development objectives (Sustainability Bonds). This issue amounting to €750 million with a 12-year maturity, attracted more than 260 investors across the world (40% from the United Kingdom, 40% from Europe, 17% from the United States, 2% from Asia, and 1% from the Middle East), including 75% asset managers and 21% institutional investors (banks, insurance companies and pension funds). The issue was oversubscribed six times, with total demand amounting to €4.4 billion.
The bonds carry a coupon of 2.75% and a 300 basis points spread over the average market rate, 12-year MID-SWAP Euro rate, which represented the lowest rates achieved by BOAD in the global financial markets.
The issue is part of a “Sustainability Bond Framework”, calling on BOAD to finance projects with a high social and environmental impact. The proceeds will reinforce BOAD’s capacity to invest in priority sectors such as agriculture and food security, renewable energy, basic infrastructure, health, education and social housing.
In line with the vision developed in the strategic plan DJOLIBA, this operation follows the appointment in August 2020 of Mr. Serge Ekue, former director of financing and investment activities for Natixis in London, as President of the West African Development Bank.
“We are strengthened by the tremendous feedback we received from investors. The very high quality of the order book and the significant level of oversubscription attest to the investors’ support for the Bank’s vision and their confidence in the WAEMU region’s prospects for growth and prosperity”, said Serge Ekue.
About the BOAD
The West African Development Bank (BOAD) is the common development finance institution of the member countries of the West African Economic and Monetary Union (WAEMU). A public international institution whose purpose, as provided under Article 2 of its Articles of Association, is “to promote the balanced development of member countries and foster economic integration within West Africa” by financing priority development projects. The Bank is accredited to the three climate finance mechanisms (GEF, AF, GCF). As of 2009, BOAD has been an observer to the UNFCCC and actively contributes to discussions relating to the design of an international climate finance architecture. Since January 2013, it has been home for the first Regional Collaboration Center (RCC) on Clean Development Mechanism (CDM), whose aim is to provide direct support to governments, NGOs and the private sector in identifying and developing CDM projects. It is committed to becoming carbon neutral by 2023.
Source: West African Development Bank (Published on January 22, 2021)