World Bank A$50m tap of Aug 2020 Bondi, 0.915% yield, ASW+18bp

The World Bank (International Bank for Reconstruction and Development), rated Aaa/AAA (Moody's/S&P), has tapped its 2.2% August 28 2020 blockchain Kangaroo, or Bondi, bond for A$50m (US$34m) to increase the issue size to A$160m.

Adds distribution and settlememt details

SYDNEY, Aug 16 (IFR) - The World Bank (International Bank for Reconstruction and Development), rated Aaa/AAA (Moody's/S&P), has tapped its 2.2% August 28 2020 blockchain Kangaroo, or Bondi, bond for A$50m (US$34m) to increase the issue size to A$160m.

The reopening, via joint lead managers CBA, RBC Capital Markets and TD Securities, priced at 101.318 for a yield of 0.915%, equivalent to asset swaps plus 18bp.

The addition was bought by three investors, two of which were new including an offshore investor. New South Wales Treasury Corp participated again having been one of seven investors in the initial A$110m sale last August.

The other six were Commonwealth Bank of Australia, First State Super, Northern Trust, QBE, South Australian Government Financing Authority and Treasury Corporation of Victoria.

The original issue, via sole lead CBA, priced at 99.901 for a yield of 2.251%, 23bp wide of asset swaps.

The Bondi Kangaroo is the first, and thus far only, public offering of blockchain bonds, which can be managed and traded with activity recorded on a distributed ledger.

The trading functionality was developed by CBA in conjunction with the World Bank and market-maker TD Securities.

The Bondi bond does not fully embrace blockchain technology, however, as payments are still be made via the existing SWIFT system to avoid the 10% Australian goods and services tax on fiat-currency-linked tokens.

Settlement for the initial sale was T+3 days, the same period for the reopening which priced on August 13 and settles today, August 16.

In a long-awaited breakthrough the World Bank and CBA announced in May they had enabled secondary trading recorded on blockchain for the bond.

(Reporting by John Weavers; Editing by Vincent Baby)

((john.weavers@thomsonreuters.com; 612 9373 1655; Reuters Messaging: john.weavers.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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