BADEA celebrates historic capital market debut with EUR 500 Mn benchmark social bond
▌ The Arab Bank for Economic Development in Africa (BADEA) rated ‘Aa2 / Positive Outlook’ (Moody’s), ‘AA / Positive Outlook’ (S&P) and ‘AAA / Stable Outlook’ (JCR) made its debut in the capital market with its first ever bond issuance – a 3-year EUR 500 Mn Reg-S only social bond issued at a yield of 3.806% and a coupon of 3.75%, marking a significant milestone in the Bank’s 50-year history.
The issuance, which received overwhelming support from investors raised EUR 500Mn on the back of a final orderbook exceeding EUR 1.2 Billion from over 50 high-quality investors comprising central banks and official institutions from more than 27 countries in 4 continents. The 3-year bond marks the launch of BADEA’s borrowing program.
The bond was announced early morning on January 18th and investors responded immediately with strong interest in this debut issue – reaching EUR 1.5 Bn within the first few hours.
H.E. Dr. Fahad Aldossari, ’s Board Chairman, said: “We are thrilled by the overwhelmingly positive response to our debut bond issuance which reflects the confidence that investors have in BADEA’s financial strength and strategic direction. This new momentum of capital markets access will supplement the Bank’s historic funding support from its shareholders – further cementing the Bank’s central role at the heart of the Arab-African economic cooperation.”
H.E. Dr. Sidi Ould Tah, BADEA’s President, said: “Our inaugural bond was very well received by investors from across the world. We are grateful to the investor community for the confidence placed in BADEA at a time when we are celebrating 50 years since establishment. We look forward to a fruitful and long-term journey in the capital markets, as we continue to channel resources towards priority sectors in sub-Saharan Africa with a special focus on social impact.”
The proceeds from this social bond will be applied by BADEA towards eligible projects in accordance with the Bank’s sustainable finance framework.
The successful transaction was led by Afreximbank, Citi, Deutsche Bank and JP Morgan, as Joint Global Coordinators / Joint Lead Managers, as well as Emirates NBD Capital, Société Générale Corporate & Investment Banking, and Standard Chartered Bank as Joint Lead Managers and Joint Bookrunners.
BADEA is a multilateral development financial institution owned by 18 Arab countries. The Bank was founded in 1974 with the purpose of fostering, supporting and enhancing economic, financial and technical cooperation between Arab and African countries.
Social impact and sustainability are at the heart of BADEA’s priorities and the ‘BADEA 2030’ strategy. To achieve its mission, the Bank mainly plays a catalytic role and offers several impactful financial instruments ranging from sovereign loans with a predominance in infrastructure finance, trade and private sector development, agriculture value chain development, entrepreneurship and SMEs development. The Bank also provides capacity building non-refundable grants to support key development projects in Sub-Saharan Africa aligned with its mandate.
BADEA has a very strong credit rating from the top global rating agencies: ‘Aa2/Positive Outlook’ by Moody’s, ‘AA/Positive Outlook’ by S&P Global and ‘AAA/Stable Outlook’ by Japan Credit Rating Agency.