World Bank Launches 2025 with AUD 1.75 Billion Sustainable Development Bond in Kangaroo Market

The issuance attracted unprecedented interest from over 70 investors globally, resulting in a robust final orderbook exceeding AUD 3.1 billion.

The World Bank (International Bank for Reconstruction and Development, IBRD, rated Aaa/AAA) successfully priced its first benchmark bond for 2025 with an Australian dollar (AUD) 1.75 billion 5-year Sustainable Development Bond. The bond, maturing on January 10, 2030, highlights the World Bank's commitment to supporting green and social initiatives across its member countries.

The issuance attracted unprecedented interest from over 70 investors globally, resulting in a robust final orderbook exceeding AUD 3.1 billion. The bond offers a fixed coupon rate of 4.35% per annum, corresponding to a spread of +42 basis points over the Australian government bond maturing in November 2029.

The transaction was managed by four joint-lead managers: ANZ, Commonwealth Bank of Australia, Nomura, and RBC Capital Markets. This issuance serves as a benchmark in the Kangaroo market, solidifying the World Bank's reputation for providing high-quality investment opportunities aligned with its mission to end extreme poverty and foster sustainable prosperity.

Global and Local Support Drive Success

Jorge Familiar, Vice President and Treasurer of the World Bank, emphasized the importance of the transaction: “We are pleased to kick off 2025 with a transaction in the Australian dollar market again – this is an excellent start to the World Bank’s funding program for the new year. This is a core market for a diverse group of global investors, and this benchmark provides them an opportunity to contribute to the World Bank’s mission to end extreme poverty and boost shared prosperity on a livable planet through a liquid, high-quality investment.”

Australian and international investor participation was key to the transaction’s success.

Market Leader Reactions

ANZ, Commonwealth Bank of Australia (CBA), Nomura, and RBC praised the issuance for its strong demand and strategic timing:

Brenton Smith, Director of Debt Syndicate at ANZ, highlighted the bond’s significance: “The impressive AUD 3.1 billion final orderbook and the World Bank's ability to tighten the final price underscore the robust and diverse investor base cultivated in the Kangaroo market. This issuance sets a solid benchmark for the Sovereign, Supranational, and Agency (SSA) market for 2025.”

Nikolaus Romuld, Head of Bond Syndicate and High Grade Origination at CBA, commended the transaction: “The World Bank’s AUD 1.75 billion Sustainable Development Bond attracted diverse investors, with meaningful engagement from Australian buyers in the SSA sector at the start of the year. CBA is delighted to have been involved.”

Harald Eikeland, Head of APAC Syndicate at RBC Capital Markets, noted: “This impressive return to the Kangaroo market reaffirms the World Bank's commitment to the Australian dollar market, which has once again borne fruit through this sizeable and well-received transaction.”

Oliver Holt, Head of AeJ DCM and Syndicate at Nomura, remarked: “The World Bank has once again reopened the global bond markets with a landmark Kangaroo benchmark. This deal saw record investor participation, surpassing support for any other SSA issuer in this market. Nomura was delighted to partner with the World Bank for this 2025 market-opening transaction.”

Purpose-Driven Investment

Proceeds from the bond issuance will be directed toward financing green and social projects across IBRD member countries. This includes initiatives in sustainable development, poverty reduction, and climate action. The strong demand reflects investor confidence in the World Bank's creditworthiness and mission-driven approach to global development.

The transaction underscores the World Bank’s pivotal role in mobilizing private capital for sustainable investments, setting the stage for continued leadership in the SSA market throughout 2025.