MANILA, Philippines - The Asian Development Bank (ADB) returned to the U.S. dollar bond market on Wednesday with the pricing of a 3-year global benchmark bond worth $2.25 billion and a 10-year global benchmark bond worth $2.0 billion, both of which have been significantly oversubscribed.
"The dollar market has seen a very active start to the new year," ADB Treasurer Pierre Van Peteghem said Wednesday.
"ADB is very pleased to make its first outing a strong one. The dual 3-year and 10-year tranche approach allowed the bank to respond to investor demand on both ends of the maturity spectrum as reflected in the final orderbook being over $6.5 billion. It is also noteworthy that this 10-year transaction opened the market for supranationals in that tenor and equaled ADB's largest 10-year transaction to date."
The 3-year bond, with a coupon rate of 1.625% per annum payable semi-annually and a maturity date of 24 January 2023, was priced at 99.953% to yield 7.7 basis points over the 1.5% US Treasury notes due January 2023.
The 10-year bond, with a coupon rate of 1.875% per annum payable semi-annually and a maturity date of 24 January 2030, was priced at 99.610% to yield13.25 basis points over the 1.75% US Treasury notes due November 2029.
The transaction was lead-managed by Barclays, J.P. Morgan, Nomura, and RBC Capital Markets. A syndicate group was also formed consisting of ANZ, Commerzbank, ING, Credit Agricole, and Natwest Markets.
Both issues achieved wide primary market distribution with 37% of the 3-year bonds placed in Asia, 37% in the Americas, and 26% in Europe, the Middle East, and Africa.
By investor type, 51% of the bonds went to central banks and official institutions, 35% to banks, and 14% to fund managers and other types of investors.
For the 10-year bonds, 55% were placed in Europe, the Middle East, and Africa; 31% in Asia; and 14% in the Americas.
By investor type, 36% of the bonds went to central banks and official institutions, 44% to banks, 20% to fund managers, and other types of investors.
ADB says it plans to raise around $25 billion from the capital markets this year.