AIIB issues seven-year Swiss Franc denominated bonds for CHF200million

Mumbai: The Asian Infrastructure Investment Bank (AIIB), a multilateral development bank focusing on sustainable infrastructure development in the Asia-Pacific region, has recently issued Swiss Franc denominated bonds worth CHF200 million.

The seven-year bond which has received the highest triple `A’ credit ratings from Moody's, S&P, and Fitch, was priced on June 6, 2023. In terms of the pricing, investors in AIIB's bond will receive an annual coupon rate of 1.750%. BNP Paribas and Credit Suisse were the joint lead managers for the bond issuance.

Banks and treasury investments accounted for the largest share, representing 32.7% of the total investment. Insurance and Pension Funds followed closely behind with a share of 28.0%. Asset Managers also showed significant interest, contributing to 31.1% of the investment. Private Banks and Official Institutions held a smaller but still notable portion, comprising 8.2% of the overall investment.

This transaction marks the second inaugural benchmark for AIIB this year and the longest maturity of a public bond issued by the Bank to date. The issuance further diversified AIIB’s investor base and attracted strong demand from bank treasuries, insurance, pension funds, and asset managers, the company said.

“We are grateful for the support from Swiss investors on AIIB’s inaugural CHF benchmark in a new market with a high-quality order book,” said Domenico Nardelli, AIIB Treasurer. “With this issuance, we have increased our investor base, expanded our presence in the global capital markets and have now a good start at issuing longer maturities.”

AIIB has now issued $33.77 billion equivalent of Sustainable Development Bonds in 17 currencies since its inaugural bond issuance in 2019. All proceeds from AIIB bonds will be used to support AIIB’s mission of Financing Infrastructure for Tomorrow in accordance with its operational and financial policies. All AIIB-financed projects, both in Asia and across the globe, are screened for their environmental and social benefits and impacts.

“With a total of 218 approved projects in 34 members, AIIB's operations are growing rapidly. It is therefore fitting that AIIB, as a triple-A issuer, continues to attract investors around the world. Adding the CHF market to AIIB's funding program is an important step as we expand our impact globally,” according to Darren Stipe, AIIB Head of Funding.


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