REG - Inter-American Dev - Issue of Debt
24/01/2024 08:15
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RNS Number : 6873A Inter-American Development Bank 23 January 2024
PRICING SUPPLEMENT
Inter-American Development Bank
Global Debt Program
Series No.: 885
Tranche No.: 2
CAD750,000,000 4.60 percent Notes due March 1, 2029 (the "Notes") as from
January 23, 2024, to be consolidated and form a single series with the Bank's
CAD500,000,000 4.60% Notes due March 1, 2029, issued on October 12, 2023 (the
"Series 885 Tranche 1 Notes")
Issue Price: 104.330 percent plus 103 days' accrued interest
Application has been made for the Notes to be admitted to the
Official List of the Financial Conduct Authority and
to trading on the London Stock Exchange plc's
UK Regulated Market
BMO Capital Markets
CIBC Capital Markets
RBC Capital Markets
TD Securities
The date of this Pricing Supplement is January 18, 2024.
Terms used herein shall be deemed to be defined as such for the purposes of
the Terms and Conditions (the "Conditions") set forth in the Prospectus dated
July 28, 2020 (the "Prospectus") (which for the avoidance of doubt does not
constitute a prospectus for the purposes of Part VI of the United Kingdom
("UK") Financial Services and Markets Act 2000 or a base prospectus for the
purposes of Regulation (EU) 2017/1129 (as amended, the "Prospectus
Regulation") or the Prospectus Regulation as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("EUWA")). This
Pricing Supplement must be read in conjunction with the Prospectus. This
document is issued to give details of an issue by the Inter-American
Development Bank (the "Bank") under its Global Debt Program and to provide
information supplemental to the Prospectus. Complete information in respect
of the Bank and this offer of the Notes is only available on the basis of the
combination of this Pricing Supplement and the Prospectus.
UK MiFIR product governance / Retail investors, professional investors and
ECPs target market - See "General Information-Additional Information Regarding
the Notes-Matters relating to UK MiFIR" below.
Terms and Conditions
The following items under this heading "Terms and Conditions" are the
particular terms which relate to the issue the subject of this Pricing
Supplement. Together with the applicable Conditions (as defined above), which
are expressly incorporated hereto, these are the only terms that form part of
the form of Notes for such issue.
1. (a) Series No.: 885
(b) Tranche No.: 2
2. Aggregate Principal Amount: CAD750,000,000
As from the Issue Date, the Notes will be consolidated and form a single
series with the Series 885 Tranche 1 Notes.
3. Issue Price: CAD792,210,000, which amount represents the sum of (a) 104.330 percent of the
Aggregate Principal Amount plus (b) the amount of CAD9,735,000 representing
103 days' accrued interest, inclusive.
4. Issue Date: January 23, 2024
5. Form of Notes Registered only, as further provided in paragraph 9(c) of "Other Relevant
(Condition 1(a)): Terms" below
See also "Additional Information regarding the Description of the Notes-Form,
Denomination and Registration" below.
6. New Global Note: No
7. Authorized Denomination(s) CAD1,000 and integral multiples thereof
(Condition 1(b)):
8. Specified Currency Canadian Dollars ("CAD") being the lawful currency of Canada
(Condition 1(d)):
9. Specified Principal Payment Currency CAD
(Conditions 1(d) and 7(h)):
10. Specified Interest Payment Currency CAD
(Conditions 1(d) and 7(h)):
11. Maturity Date March 1, 2029
(Condition 6(a); Fixed Interest Rate):
12. Interest Basis Fixed Interest Rate (Condition 5(I))
(Condition 5):
13. Interest Commencement Date (Condition 5(III)): October 12, 2023
14. Fixed Interest Rate (Condition 5(I)):
(a) Interest Rate: 4.60 percent per annum
(b) Fixed Rate Interest Payment Date(s):
Semi-annually in arrears on March 1 and September 1 in each year, commencing
with a short first coupon on March 1, 2024, up to and including the Maturity
Date.
Each Fixed Rate Interest Payment Date is subject to the Business Day
Convention, but with no adjustment to the amount of interest otherwise
calculated.
(c) Business Day Convention: Following Business Day Convention
(d) Fixed Rate Day Count Fraction(s):
Actual/Actual Canadian Compound Method, which means when calculating interest
for a full semi-annual fixed rate interest period, the day count convention is
30/360 and when calculating interest for a period other than a full
semi-annual fixed rate interest period, the day count convention is Actual/365
(Fixed).
15. Relevant Financial Center: London, Toronto, New York
16. Relevant Business Day: London, Toronto, New York
17. Issuer's Optional Redemption (Condition 6(e)): No
18. Redemption at the Option of the Noteholders (Condition 6(f)): No
19. Governing Law: New York
Other Relevant Terms
1. Listing (if yes, specify Stock
Exchange):
Application has been made for the Notes to be admitted to the Official List of
the Financial Conduct Authority and to trading on the London Stock Exchange
plc's UK Regulated Market with effect from the Issue Date.
2. Details of Clearance System Approved by the Bank and the
Global Agent and Clearance and Settlement Procedures:
CDS Clearing and Depository Services Inc. ("CDS") and through direct or
indirect participation in CDS: DTC, Euroclear Bank SA/NV and Clearstream
Banking S.A.
For Clearance and Settlement Procedures, see "Additional Information regarding
Clearing and Settlement" below.
3. Syndicated: Yes
4. If Syndicated:
(a) Liability: Several
(b) Joint Lead Managers: Bank of Montreal, London Branch
CIBC World Markets Inc.
RBC Dominion Securities Inc.
The Toronto-Dominion Bank
5. Commissions and Concessions: 0.0462% of the Aggregate Principal Amount
6. Estimated Total Expenses: The Managers have agreed to pay for all material expenses related to the
issuance of the Notes, except the Issuer will pay for the London Stock
Exchange listing fees, if applicable.
7. Codes:
(a) Common Code: 269743352
(b) ISIN: CA458182EL29
(c) CUSIP: 458182EL2
8. Identity of Dealers: Bank of Montreal, London Branch
CIBC World Markets Inc.
RBC Dominion Securities Inc.
The Toronto-Dominion Bank
9. Provisions for Registered Notes:
(a) Individual Definitive Registered Notes Available on Issue
Date:
No
(b) DTC Global Note(s): No
(c) Other Registered Global Notes:
Yes, issued in accordance with the Amended and Restated Global Agency
Agreement, dated as of July 28, 2020, as amended from time to time, between
the Bank, Citibank, N.A., London Branch as Global Agent, and the other parties
thereto. See "Additional Information regarding the Description of the
Notes-Form, Denomination and Registration" below.
10. Intended to be held in a manner which would allow Eurosystem Not Applicable
eligibility:
11. Selling Restrictions
(a) United States: Under the provisions of Section 11(a) of the Inter-American Development Bank
Act, the Notes are exempted securities within the meaning of Section 3(a)(2)
of the U.S. Securities Act of 1933, as amended, and Section 3(a)(12) of the
U.S. Securities Exchange Act of 1934, as amended.
(b) United Kingdom: Each of the Managers represents and agrees that (a) it has only communicated
or caused to be communicated and will only communicate or cause to be
communicated an invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the Financial Services and Markets Act
2000 (the "FSMA")) received by it in connection with the issue or sale of the
Notes in circumstances in which Section 21(1) of the FSMA does not apply to
the Bank, and (b) it has complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in relation to such
Notes in, from or otherwise involving the UK.
(c) Singapore: In the case of the Notes being offered into Singapore in a primary or
subsequent distribution, and solely for the purposes of its obligations
pursuant to Section 309B of the Securities and Futures Act (Chapter 289) of
Singapore (the "SFA"), the Issuer has determined, and hereby notifies all
relevant persons (as defined in Section 309A of the SFA) that the Notes are
"prescribed capital markets products" (as defined in the Securities and
Futures (Capital Markets Products) Regulations 2018 of Singapore) and Excluded
Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the Sale
of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on
Investment Products).
(d) General: No action has been or will be taken by the Issuer that would permit a public
offering of the Notes, or possession or distribution of any offering material
relating to the Notes in any jurisdiction where action for that purpose is
required. Accordingly, each Dealer agrees that it will observe all
applicable provisions of law in each jurisdiction in or from which it may
offer or sell Notes or distribute any offering material.
General Information
Additional Information Regarding the Notes
1. Use of Proceeds
The net proceeds from the sale of the Notes will be
included in the ordinary capital resources of the Bank and, will not be
committed or earmarked for lending to, or financing of, any specific loans,
projects or programs. The Bank, in partnership with its member countries,
works to reduce poverty and inequalities in Latin America and the Caribbean by
promoting economic and social development in a sustainable, climate friendly
way.
The Bank's strategic priorities include social
inclusion and equality, productivity and innovation and economic integration
along with three cross-cutting issues: gender equality and diversity, climate
change and environmental sustainability, and institutional capacity and the
rule of law. Each strategic priority of the Bank aligns to at least one of the
United Nations Sustainable Development Goals ("SDGs"), with all goals covered
within the Bank's institutional strategy, which may be adapted from time to
time should the United Nations SDGs definition evolve.
All projects undertaken by the Bank go through the
Bank's rigorous sustainability framework. The framework tracks measurable
results, adherence to lending targets and the effectiveness of its
environmental and social safeguards. The Bank's administrative and operating
expenses are currently covered entirely by the Bank's various sources of
revenue, consisting primarily of net interest margin and investment income (as
more fully described in the Bank's Information Statement).
2. Matters relating to UK MiFIR
The Bank does not fall under the scope of application of the UK MiFIR
regime. Consequently, the Bank does not qualify as an "investment firm",
"manufacturer" or "distributor" for the purposes of UK MiFIR.
UK MiFIR product governance / Retail investors, professional investors and
ECPs target market - Solely for the purposes of the UK manufacturer's product
approval process, the target market assessment in respect of the Notes has led
to the conclusion that: (i) the target market for the Notes is retail clients,
as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it
forms part of UK domestic law by virtue of the EUWA, eligible counterparties,
as defined in COBS, and professional clients, as defined in UK MiFIR; and (ii)
all channels for distribution of the Notes are appropriate. Any person
subsequently offering, selling or recommending the Notes (a "distributor")
should take into consideration the UK manufacturer's target market assessment;
however, a distributor subject to the UK MiFIR Product Governance Rules is
responsible for undertaking its own target market assessment in respect of the
Notes (by either adopting or refining the UK manufacturer's target market
assessment) and determining appropriate distribution channels.
For the purposes of this provision, (i) the expression "UK manufacturer" means
Bank of Montreal, London Branch and The Toronto-Dominion Bank, (ii) the
expression "COBS" means the FCA Handbook Conduct of Business Sourcebook, (iii)
the expression "UK MiFIR" means Regulation (EU) No 600/2014 as it forms part
of UK domestic law by virtue of the EUWA and (iv) the expression "UK MiFIR
Product Governance Rules" means the FCA Handbook Product Intervention and
Product Governance Sourcebook.
Additional Information regarding the Description of the Notes
Form, Denomination and Registration
The Notes will be issued in the form of a fully registered global note
registered in the name of CDS & CO., as nominee of CDS and held by CDS
(the "Global Note"). Beneficial interests in the Global Note will be
represented through book-entry accounts of financial institutions acting on
behalf of beneficial owners as direct and indirect participants in CDS.
Investors may elect to hold interests in the Global Note directly through any
of CDS (in Canada), DTC (in the United States) or Clearstream Banking S.A. or
Euroclear Bank SA/NV (in Europe) if they are participants of such systems, or
indirectly through organizations which are participants in such systems. DTC
will hold interests on behalf of its participants directly through its account
at CDS and Clearstream Banking S.A. and Euroclear Bank SA/NV will hold
interests on behalf of their participants through customers' securities
accounts in their respective names on the books of their respective Canadian
subcustodians, each of which is a Canadian schedule I chartered bank
("Canadian Subcustodians"), which in turn will hold such interests in
customers' securities accounts in the names of the Canadian Subcustodians on
the books of CDS. Except in the limited circumstances described below under
"Definitive Certificates", owners of beneficial interests in the Global Note
will not be entitled to have Notes registered in their names, will not receive
or be entitled to receive physical delivery of Notes in definitive form and
will not be considered owners or holders thereof under the Global Agency
Agreement.
All Notes will be recorded in a register maintained by the Registrar and will
be registered in the name of CDS & CO. (or such other nominees of CDS as
an authorized representative of CDS may advise) for the benefit of owners of
beneficial interests in the Global Note, including participants of DTC,
Clearstream Banking S.A. and Euroclear Bank SA/NV.
Definitive Certificates
No beneficial owner of the Notes will be entitled to receive physical delivery
of the Notes in definitive form except in the following limited
circumstances: (i) CDS notifies the Bank that it is unwilling or unable to
continue as depository for the Notes and a successor depository is not
appointed by the Bank within 90 working days after receiving such notice; or
(ii) CDS ceases to be a recognized clearing agency under applicable provincial
or Canadian federal securities legislation and no successor clearing system
satisfactory to the Bank is available within 90 days after the Bank becoming
aware that CDS is no longer so recognized, the Bank will issue or cause to be
issued fully registered Notes in definitive form upon registration of,
transfer of, or in exchange for, the Global Note. The Bank may also at any
time and in its sole discretion determine not to have any of the Notes held in
the form of the Global Note and, in such event, will issue or cause to be
issued fully registered Notes in definitive form upon registration of,
transfer of, or in exchange for, such Global Note.
Additional Information regarding Clearing and Settlement
Links have been established among CDS, DTC, Clearstream Banking S.A. and
Euroclear Bank SA/NV to facilitate initial issuance of the Notes and
cross-market transfers of the Notes associated with secondary market
trading. CDS will be directly linked to DTC and linked to Clearstream
Banking S.A. and Euroclear Bank SA/NV through the CDS accounts of their
respective Canadian Subcustodians.
The Clearing Systems
CDS was formed in November 2006 pursuant to the restructuring of The Canadian
Depository for Securities Limited ("CDS Ltd.") After the restructuring, CDS
Ltd., incorporated in 1970, remains the holding company for CDS and two other
operating subsidiaries. CDS is Canada's national securities clearing and
depositary services organization. Functioning as a service utility for the
Canadian financial community, CDS provides a variety of computer automated
services for financial institutions and investment dealers active in domestic
and international capital markets. CDS participants ("CDS Participants")
include banks (including the Canadian Subcustodians), investment dealers and
trust companies and may include certain of the Managers. Indirect access to
CDS is available to other organizations that clear through or maintain a
custodial relationship with a CDS Participant. Transfers of ownership and
other interests, including cash distributions, in Notes in CDS may only be
processed through CDS Participants and will be completed in accordance with
existing CDS rules and procedures. CDS operates in Montreal, Toronto,
Calgary and Vancouver to centralize securities clearing functions through a
central securities depositary.
Global Clearance and Settlement Procedures
Initial settlement for the Notes will be made in immediately available
Canadian dollar funds.
Secondary market trading between CDS Participants will be in accordance with
market conventions applicable to transactions in book-based Canadian domestic
bonds. Secondary market trading between DTC participants will occur in the
ordinary way in accordance with DTC rules. Secondary market trading between
Clearstream Banking S.A. participants and or Euroclear Bank SA/NV participants
will occur in the ordinary way in accordance with the applicable rules and
operating procedures of Clearstream Banking S.A. and Euroclear Bank SA/NV and
will be settled using the procedures applicable to conventional Eurobonds in
immediately available funds.
Transfers between CDS and DTC, Clearstream Banking S.A. or Euroclear Bank
SA/NV. Cross-market transfers between persons holding directly or indirectly
through CDS Participants, on the one hand, and directly or indirectly through
DTC, Clearstream Banking S.A. or Euroclear Bank SA/NV participants, on the
other, will be effected in CDS in accordance with CDS rules; however, such
cross-market transactions will require delivery of instructions to the
relevant clearing system by the counterparty in such system in accordance with
its rules and procedures and within its established deadlines. The relevant
clearing system will, if the transaction meets its settlement requirements,
deliver instructions to CDS directly or through its Canadian Subcustodian to
take action to effect final settlement on its behalf by delivering or
receiving Notes in CDS, and making or receiving payment in accordance with
normal procedures for settlement in CDS. DTC participants, Clearstream
Banking S.A. participants and Euroclear Bank SA/NV participants may not
deliver instructions directly to CDS or the Canadian Subcustodians.
Because of time-zone differences, credits of Notes received in Clearstream
Banking S.A. or Euroclear Bank SA/NV as a result of a transaction with a CDS
Participant will be made during subsequent securities settlement processing
and dated the business day following the CDS settlement date. Such credits
or any transactions in such Notes settled during such processing will be
reported to the relevant Clearstream Banking S.A. participants or Euroclear
Bank SA/NV participants on such business day. Cash received in Clearstream
Banking S.A. or Euroclear Bank SA/NV as a result of sales of Notes by or
through a Clearstream Banking S.A. participant or a Euroclear Bank SA/NV
participant to a CDS Participant will be received with value on the CDS
settlement date but will be available in the relevant Clearstream Banking S.A.
or Euroclear Bank SA/NV cash account only as of the business day following
settlement in CDS.
Transfers Between DTC, Clearstream Banking S.A. or Euroclear Bank SA/NV.
Cross-market transfers between Clearstream Banking S.A., Euroclear Bank SA/NV
and DTC participants will be effected in CDS.
When Notes are to be transferred from the account of a DTC participant to the
account of a Clearstream Banking S.A. participant or Euroclear Bank SA/NV
participant, the DTC participant will transmit instructions to DTC on
settlement date and the Clearstream Banking S.A. participant or Euroclear Bank
SA/NV participant will transmit instructions to Clearstream Banking S.A. or
Euroclear Bank SA/NV at least one business day prior to the settlement date.
One business day prior to settlement date Clearstream Banking S.A. and on
settlement date Euroclear Bank SA/NV, will transmit trade instructions to its
respective Canadian Subcustodian. The beneficial interests in the Notes and
payments for such beneficial interests will be transferred in CDS by DTC and
the respective Canadian Subcustodians for Clearstream Banking S.A. and
Euroclear Bank SA/NV.
Although CDS, DTC, Clearstream Banking S.A. and Euroclear Bank SA/NV have
agreed to the foregoing procedures in order to facilitate transfers of Notes
among participants of CDS, DTC, Clearstream Banking S.A. and Euroclear Bank
SA/NV, they are under no obligation to perform or continue to perform such
procedures and such procedures may be changed or discontinued at any time.
Additional Information regarding Currency Conversions
Currency Conversions
Initial purchasers are required to make payment in Canadian dollars. The
Managers are prepared to arrange for the conversion of U.S. dollars into
Canadian dollars to enable United States investors to make payment in Canadian
dollars. Each such conversion will be made by such Manager on such terms and
subject to such conditions, limitations and charges as such Manager may from
time to time establish in accordance with its regular foreign exchange
practices, and subject to applicable United States laws and regulations. All
costs of conversions will be borne by such investors. See "Certain Risk
Factors- Notes are subject to exchange rate and exchange control risks if the
investor's currency is different from the Specified Currency" in the
Prospectus.
Principal and interest payments in respect of the Notes (including Notes in
definitive form issued in exchange for the Global Note as described above
under "Definitive Certificates") are payable in Canadian dollars, but owners
of beneficial interests in Notes held through DTC ("DTC Beneficial Owners")
will receive such payments in U.S. dollars, unless they elect, through DTC and
its participants, to receive payments in Canadian dollars as set forth
below. Payments of principal and interest on Notes held through DTC will be
converted to U.S. dollars in accordance with procedures established from time
to time by CDS and DTC and paid to Cede & Co. for payment to DTC
Beneficial Owners. All costs of such conversion will be borne by DTC
Beneficial Owners receiving U.S. dollars by deduction from such payments. If
there is no facility in place between CDS and DTC for the exchange of Canadian
dollars into U.S. dollars, payment of the aggregate amount due to all DTC
Beneficial Owners on the payment date will be made in Canadian dollars outside
of DTC, unless alternative arrangements acceptable to both CDS and DTC are
made by the Bank. A DTC Beneficial Owner may elect to receive payment in
respect of the principal of or interest on the Notes in Canadian dollars by
notifying the DTC participant through which its Notes are held on or prior to
the applicable record date (in the case of an interest payment) or at least
fifteen days prior to maturity (in the case of a principal payment ) of (i)
such DTC Beneficial Owner's election to receive all or a portion of such
payment in Canadian dollars and (ii) wire transfer instructions to a Canadian
dollar account with respect to any payment to be made in Canadian dollars.
Such DTC participant must notify DTC of such election and wire transfer
instructions on or prior to the third New York business day after such record
date for any payment of interest and on or prior to the twelfth day prior to
the payment of principal. DTC will notify CDS of such election and wire
transfer instructions on or prior to the fifth New York business day after
such record date for any payment of interest and on or prior to the tenth day
prior to the payment of principal. If complete instructions are received by
the DTC participant and forwarded by the DTC participant to DTC and by DTC to
CDS, on or prior to such dates, the DTC Beneficial Owner will receive payment
in Canadian dollars outside of DTC; otherwise only U.S. dollar payments will
be made through DTC. In this paragraph, "New York business day" means a day
on which banking institutions in New York, New York are not authorized or
obligated by law or regulation to close.
Investors will be subject to foreign exchange risks as to payments in respect
of principal and interest that may have important economic and tax
consequences to them.
INTER-AMERICAN DEVELOPMENT BANK
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