IFC to launch first ever offshore Taka Bond Program
11 October 2015, Nirapad News: IFC, a member of the World Bank Group, announced on Friday (October 9) that it has received an approval from Bangladesh’s finance ministry for the first ever offshore Taka bond program.
The $1 billion-equivalent bond program aims to strengthen capital markets and increase foreign investment in Bangladesh.
Under the program, IFC will issue the first Taka-linked bonds in the offshore market and bring the proceeds back to finance investment in Bangladesh. The bonds will be listed on the London Stock Exchange, a press release said on Sunday (October 11).
‘Domestic capital markets are critical to providing long-term, local-currency finance for the private sector—which plays an essential role in job creation in emerging markets,’ said Jin-Yong Cai, IFC’s Executive Vice President & CEO.
‘IFC’s offshore bond program will help bring depth and diversity to Bangladesh’s capital markets and create an alternative source of funding for Bangladeshi companies.’
IFC’s work in Bangladesh supports the World Bank Group’s goals of ending extreme poverty and boosting shared prosperity.
As of June 30, 2015, IFC’s investment portfolio in Bangladesh for its own account and that of participants was nearly $800 million. IFC has built a strong pipeline of private sector projects in key industries such as sustainable energy, power generation and banking.
This program follows IFC’s ground-breaking Masala bond program launched in 2013.
To date, IFC has sold Indian Rupee 106 billion (or $1.7 billion) bonds to international investors. The bonds range in tenor from three to ten years and created an international triple-A yield curve for the offshore Rupee markets.
The Reserve Bank of India has now allowed Indian companies to issue offshore Rupee bonds, expanding access to international capital markets for local firms.
IFC has, over the years, launched various bond programs with the aim to strengthen local capital markets and to finance projects in emerging markets.
So far, IFC has issued bonds in 17 local emerging market currencies such as Armenian Dram, Chinese Renminbi, Indian Rupee, Peruvian Soles and Zambian Kwacha.
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging markets. Working with more than 2,000 businesses worldwide, we use our capital, expertise, and influence, to create opportunity where it’s needed most.
In FY15, our long-term investments in developing countries rose to nearly $18 billion, helping the private sector play an essential role in the global effort to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.