On September 10, 2024, New Development Bank (NDB) issued 3- and 5-year notes totalling ZAR 1 billion in the South African bond market.
The book was well supported with over ZAR 2.0 bn in bids across both tenors. Both the 3-year and the 5-year tranches priced at the tight end of guidance, with the 5-year note pricing 5bps tighter than the previous auction. The orderbook was well diversified with bids being allocated to both institutional investors and the local banks.
Mr. Monale Ratsoma, NDB Vice-President and Chief Financial Officer commented that “Local currency financing is a core offering of NDB and the bank has a robust pipeline of rand-denominated loans for infrastructure and sustainable development projects. NDB’s rand programme will play a central role in funding the bank’s commitments in South Africa and NDB will therefore continue establish itself as a regular issuer in the local capital market.”
Bond Summary Terms
| Issuer | New Development Bank (NDB) | |
| Issuer rating | AA+ (S&P) / AA (Fitch) | |
| Currency | ZAR | |
| Listing | Johannesburg Stock Exchange | |
| Interest Rate Profile | Floating rate | |
| Pricing Benchmark | 3M JIBAR | |
| Amount | ZAR 500,000,000 | ZAR 500,000,000 |
| Tenor | 3 years | 5 years |
| Pricing Spread | 90 bps | 105 bps |
| Trade/Auction Date | September 5, 2024 | September 5, 2024 |
| Issuance/Settlement Date | September 10, 2024 | September 10, 2024 |
| Maturity Date | September 10, 2027 | September 10, 2029 |
| Arrangers / Dealers | Rand Merchant Bank, Standard Bank of South Africa Limited | |
Background information
New Development Bank was established with the purpose of mobilizing resources for infrastructure and sustainable development projects in BRICS and other emerging market economies and developing countries, complementing the efforts of multilateral and regional financial institutions for global growth and development. In 2021, NDB initiated membership expansion and admitted Bangladesh, Egypt, United Arab Emirates and Uruguay as its new member countries.