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IFC Returns to Kauri Market, Raises $266 Million for Lending in Emerging Markets


In Washington, D.C.:
Alexandra Klopfer
Phone: (202) 473-4645
E-mail: aklopfer@ifc.org

In Hong Kong:
Hannfried von Hindenburg
Phone: (852) 2509-8115
E-mail: hvonhindenburg@ifc.org

Washington, D.C., October 12, 2011—IFC, a member of the World Bank Group, returned to the Kauri market for a second time this year, increasing an existing issue under its Global Medium-Term Note Program by 350 million New Zealand dollars ($266 million equivalent).

The transaction is part of IFC’s regular fundraising for private sector lending in emerging markets. It is the largest issue by a supranational in the Kauri market since January 2008.

“This issue demonstrates continued strong demand for IFC debt. We remain committed to supporting markets in Asia and the Pacific, and to raising funds for IFC’s lending operations in emerging markets,” said Jingdong Hua, IFC Vice President and Treasurer. “IFC will consider additional issues in the region subject to market conditions.”

Demand for the transaction was driven by key lead orders from domestic financial institutions and other investors. The issue, which matures on May 25, 2016, and carries an annual coupon of 4.625 percent, was priced in line with initial guidance to yield 3.773 percent.  

“The positive reception for IFC’s Kauri issue indicates strong support for IFC during this period of high market volatility,” said John Borthwick, IFC Deputy Treasurer and Head of Funding. “It validates our strategy in the New Zealand and Australian markets—concentrating bond issuance into a small number of relatively larger, more liquid lines of debt."  

IFC’s market borrowing activities focus on two goals—raising and securing funds to meet IFC’s annual funding requirements and stimulating growth in emerging capital markets by issuing bonds in local currencies such as Brazilian reais, Central African francs, and Malaysian ringgit.

The proceeds of the Kauri issue were swapped into floating-rate U.S. dollar funds and will be used to finance IFC’s lending operations. IFC provides loans, equity, structured finance, risk-management products, as well as advisory services to private enterprises in developing countries.

In May 2011, IFC issued a 150 million New Zealand dollar note. IFC is one of the main debt issuers in the Kauri market, with 1.4 billion in New Zealand dollar notes issued since 2008.

Australia and New Zealand Banking Group and Westpac Institutional Bank were the joint lead managers for this transaction.

About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in developing countries. We create opportunity for people to escape poverty and improve their lives. We do so by providing financing to help businesses employ more people and supply essential services, by mobilizing capital from others, and by delivering advisory services to ensure sustainable development. In a time of global economic uncertainty, our new investments climbed to a record $18 billion in fiscal 2010. For more information, visit www.ifc.org.

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