Nordic Investors Rush to Tap of SDG Bond

    Stockholm (NordSIP) – The World Bank’s International Bank for Reconstruction and Development (IBRD) conducted a NOK500 million tap of its Sustainable Development Bond bond series maturing on November 6th, 2024 originally launched two months ago. Following this tap, the outstanding volume on this security is NOK4 billion.

    The tap was a private placement with green and light green nordic bank treasuries and asset managers. It had a reoffer price of 5bps below the 3-month NIBOR, equivalent to 12.8bps below the 6-month NIBOR. DNB Acted as sole book-runner for this transaction.

    The theme of this sustainable development is water and ocean resources and the challenge of plastic waste pollution in oceans. The World Bank has issued more than thirty Sustainable Development Bonds to raise awareness for clean water, sanitation, and marine protection (Sustainable Development Goals 6 and 14). Among the other water-themed Sustainable Development Bonds, there is also a SEK bond maturing in November 2026.

    The SDG bond pays a 1.75% coupon and was first issued on November 6, 2019. The inaugural issuance was worth NOK2.5 billion and was priced at a 99.83 discount to yield 1.7865%. On that occasion,  DNB Treasury, Equinor, and Nordea Investment Management and Treasury were key investors in the security, which was representative of demand statistics which showed Bank Treasuries were the single largest investor group (70%) while investors based in Nordic countries represented 88% of the demand.

    “This transaction is part of the World Bank’s initiative to raise awareness for the critical role of water and ocean resources,” Heike Reichelt, Head of Investor Relations and New Products, World Bank Treasury said on the occasion of the series inaugural issuance. “It shows that there’s growing interest from investors to engage on specific sustainable development goals and that they value the World Bank as an opportunity to invest for impact.”

    “It’s our responsibility to lead the Norwegian investment community in increasing the focus on sustainable investments,” Reidar Bolme, Group Treasurer at DNB said added on the same occasion. “We therefore welcome the opportunity to do so whilst also raising awareness towards the crucial need to protect our future water supply. DNB is proud to partner with the World Bank in order to support this initiative.”

    The IBRD is the largest multilateral source of financing for ocean and water projects in developing countries. It is committed to working with countries to ensure access to safe and clear water and for the sustainable use of ocean and marine resources. This also includes preventing pollution.

    Image by Elias Sch. from Pixabay


    Filipe Albuquerque
    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

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