AfDB issues $20 million Infrastructure Bonds to a Japanese Life Insurance Company

OREANDA-NEWS. July 28, 2015. African Development Bank (AfDB) sold \\$20 million in infrastructure bonds to the Fukoku Mutual Life Insurance Company (Fukoku Life). Fukoku Life was the sole investor in the bond.

Africa still has massive infrastructure needs. Bridging the infrastructure gap could increase GDP growth by an estimated 2 percentage points a year. Since inception and more recently through its Private Sector Operations department, the AfDB has been and is still making significant contributions to infrastructure development in Africa. The Bank’s investments in transport, energy, ICT and water, have resulted in improved quality of life for tens of millions of African people.

Infrastructure development is one of the five operational priorities under the ten-year strategy (2013-2022). The   AfDB intends to significantly scale up infrastructure financing on the continent—not just through its own lending - but by leveraging its financial resources. Issuance of the infrastructure bonds is one of the alternative financing solutions which can support investments in various infrastructure projects, while securing capital to match long-term needs.

The AfDB will use net profits from the infrastructure bonds to finance lending to infrastructure projects. This will be in accordance with the Bank’s  lending standards.

Fukoku Life believes the infrastructure bonds could offer attractive return on their policy holders’ funds while, achieving a positive social impact in Africa.

The bonds were offered to Fukoku Life through a private placement format, with J.P. Morgan beingthe sole arranger of the bonds.

Summary Terms of the AfDB Infrastructure Bonds