IDB sets a new dollar benchmark
June 12, 2019 |
Latin American development bank sells $2.1bn in new 10-year notes as demand tops $2.7bn
The Inter-American Development Bank (IDB) has sold $2.1bn in new 10-year notes, tightening the spread by a point on solid demand, LatinFinance has heard.
The bookrunners Citi, Goldman Sachs and TD Securities had put the initial guidance at 16bp over mid-swaps, but they priced the notes at 15bp over mid-swaps after the order book topped $2.7bn, said a source involved in the deal.
The IDB had aimed to sell at least $1bn in its latest dollar-denominated bond sale, but it was open to increasing the size of the offer to meet demand, the source added.
The new 2.25% 2029s priced at 99.822 to yield 2.27%, or 12.25bp over US Treasury notes, the development bank said in a statement.
"Given the lack of supply in this part of the curve as well as a slight backup in rates, we pinpointed a good issuance window," Laura Fan, the head of funding at the IDB, said in the statement.
Close to 70 accounts bought the new notes with 45% from Asia, 36% from Europe, the Middle East and Africa and 19% from the Americas. Commercial banks and private banks made up 44% of the buyers, followed by central banks and official institutions at 39%, asset managers at 14% and pension funds and insurance companies at 3%, the IDB said.
The IDB sold $3.25bn in five-year dollar bonds at 10bp over mid-swaps when it started its funding program this year. It last sold 10-year dollar notes in September 2018, when it raised $2.8bn at 12bp over mid-swaps.