MDBs raise $12bn at start of 2023

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Asian Development Bank (ADB) raises $5.5bn, the European Investment Bank (EIB) raises £5bn and the Inter-American Development Bank (IADB) raises $2bn ahead of ambitious year.

Three multilateral development banks have begun 2023 with ambitious finance-raising programmes to strengthen their project support throughout the year. 

The ADB has issued a three-year US dollar bond worth $3.5bn and a ten-year bond worth $2bn to support the bank’s capital resources for development across Asia. The ADB issued a $2bn five-year bond, their first such bond issued since January 2022 and the EIB has announced the issue of $5bn of bonds this month.

The ADB bonds issued at the start of January have been bought from around the world, with Europe, the Middle East and Africa buying around half of the bonds and with central banks making up one fifth of buyers.

ADB treasurer Pierre Van Peteghem commented: “We appreciate the strong support from our investors across regions in our first global benchmark outing of the year. With an order book of over $13bn, we raised $5.5bn across the two tranches, providing ADB with additional resources as we help our developing member countries tackle challenges, including recovery from the pandemic, food security and climate change.”

The strength of this rights issue will be important to the ADB, which has set out plans to raise over $31bn throughout 2023. At the same time, the IADB’s five-year bond was just the opening step to raise significant finance this year.

Laura Fan, head of funding at the IADB, commented: “This transaction commences our 2023 borrowing programme which is expected to be around $17-$18bn. Despite the congested new issue market, the deal received strong support from high-quality investors, leading to a solid outcome for our first foray in the US dollar market this year.” 

The EIB announced the issue of their bonds this month as it continues to invest heavily in sustainability and economic development projects as well as playing a big part in Europe’s effort to support the response both in Ukraine and in neighbouring nations.