The Asian Development Bank has raised $NZ225 million in its first Kauri bond sale.A Kauri bond is a New Zealand dollar denominated bond, registered in New Zealand and issued by a foreign issuer. The first Kauri bonds were issued in 2004 and there was a sh
The Asian Development Bank has raised $NZ225 million in its first Kauri bond sale.
A Kauri bond is a New Zealand dollar denominated bond, registered in New Zealand and issued by a foreign issuer. The first Kauri bonds were issued in 2004 and there was a sharp spike in issuance after the Reserve Bank of New Zealand decided in 2007 to accept AAA rated Kauri bonds as security in domestic central bank operations, according to a paper published by the RBNZ in 2008.
The Asian Development Bank bonds will be issued on January 29. They have a coupon rate of 5.375 percent per annum payable semi-annually. The bonds mature on January 29, 2014. They were priced to yield 62 basis points over the 6.5 percent New Zealand government bond due April 2013.
The transaction was lead-managed by ANZ National Bank and Royal Bank of Canada Capital Markets.
About 62 percent of the sale was placed domestically and 38 percent offshore. Around 41 percent of the bonds were bought by financial institutions, 30 percent by fund managers, 24 percent by central banks and the remainder by other investors such as middle-market institutions.
The proceeds will be part of ADB's ordinary capital resources and used in its non-concessional operations.
