Standard Bank successfully facilitates inaugral ZAR1.5bn bond issuance for the New Development Bank

Established in 2015 by BRICS countries, the New Development Bank (“NDB”) is a multilateral development bank which finances projects and innovates tailored solutions to help build a more inclusive, resilient and sustainable future for the planet.

NDB trusted Standard Bank as sole arranger to establish their domestic ZAR multi-term note (“DMTN”) programme. Following the listing of the DMTN on the JSE, Standard Bank acted in its capacity as co-arranger on NDB’s inaugural ZAR bond issuance, facilitating an extensive fixed income investor roadshow. This culminated in a successful bond auction which attracted ZAR2.7bn worth of bids, with NDB issuing the full ZAR1.5bn sought. The auction was 1.8 times oversubscribed with 94% of bids within or lower than price guidance, with the outcome representing the tightest spreads achieved by any non-Government issuer in the South African Debt Capital Markets in 2023. The orderbook was well diversified with 71% of bids being allocated to institutional investors and the remainder taken up by local banks. Standard Bank has also been appointed in various agency roles on the programme, including debt sponsor and paying, settlement, transfer, calculation and issuer agent.

To fulfil its purpose to create a more sustainable future, NDB has 6 focus areas:

• Digital infrastructure: With the accelerated digitisation and the persisting digital divide, NDB finances projects that empower the expansion and modernisation of national and international backbone digital infrastructure to provide universal and affordable access to all member countries.
• Social infrastructure: NDB understands that the value of social infrastructure goes beyond economic benefits and supports the building and modernisation of social infrastructure, such as schools, hospitals, affordable housing, cultural heritage sites and other long-term physical assets that facilitate social services and support human development, quality of life and living standards.
• Environmental protection: To reverse or reduce the negative environmental impact of socioeconomic activities, NDB supports projects that involve conservation and restoration of key ecosystems, promote nature-based solutions and better management of natural resources and contribute to pollution prevention and abatement.
• Water and sanitation: NDB supports projects that facilitate universal access to clean drinking water and adequate sanitation, promote equitable and sustainable management of water resources and reduce vulnerability and exposure to water-related disasters, particularly those triggered by climate change, such as droughts and floods.
• Transport infrastructure: To help promote regional connectivity and facilitate the movement of people, goods and services, NDB supports the development of inter-city and intra-city transport networks.
• Clean energy and energy efficiency: To enhance the efficiency of power transmission, distribution and storage, NDB prioritises projects that entail deployment of clean and renewable energy at scale. 

Following this transaction, NDB will deploy the funds raised into infrastructure and sustainable development projects to facilitate growth and development within South Africa. The projects which NDB funds are typically high-priority projects in the national interest of South Africa which have been identified by the Presidential Infrastructure Coordinating Commission.

NDB will continue to strengthen its role in financing large infrastructure projects in the BRICS countries, while also continuing to expand its membership after recently welcoming Uruguay, UAE and Bangladesh as new member countries.