A$550m 4.400% Kangaroo Social Inclusion Bond Benchmark due May 2030

Paris - On Tuesday 25th February 2025, Council of Europe Development Bank (CEB), rated Aaa/AAA/AAA (all stable), priced a new A$550m long 5-year Kangaroo Social Inclusion Bond due 24th May 2030

Highlights

• CEB took advantage of a positive backdrop in the SSA Kangaroo primary markets to start 2025, as well as strong interest from dedicated Social investors for high quality ESG paper in the AUD space
• This transaction marks the second AUD Kangaroo Social Inclusion Bond benchmark in a row from the CEB, following last year’s highly successful first ever Kangaroo Social Inclusion Bond in benchmark format
• The deal was met with very high-quality demand globally driven by Central Banks and Official Institutions which received 84% of the allocation. The orderbook closed in excess of A$750m, highlighting the importance of the Social Inclusion feature
• Final allocations were broadly spread across regions and investor types, with demand coming from EMEA, Asia, LatAm and Australia. Focusing on the ESG driven demand, over 88% of the transaction was allocated to accounts with a strong ESG mandate
• With this trade, CEB extends their benchmark Kangaroo curve with a new liquid reference point in a strategic maturity bucket, following last year’s AUD 600m 5yr Kangaroo SIB
• The Joint Lead Managers on the transaction were Commonwealth Bank of Australia, Deutsche Bank and RBC Capital Markets

Deal details

• The new AUD 5.25-year Social Inclusion Bond was announced to the market on Monday February 24th at 10:23 CET / 20:23h SYD with indicative pricing of ASW +50bps area
• The trade has seen a strong interest from high-quality accounts, with books standing in excess of A$630m (incl. A$50m JLMs) at the first book update at 23:04 CET / 09:04 (+1) SYD, while price guidance remained unchanged at ASW+50bps area
• At 4:10 CET /14:10h SYD a second book update was published, by which allocations were released. Final demand stood in excess of A$750m (incl. A$ 150m JLMs), with a final deal size set at A$550m, while the spread was set previously at ASW SQ+50bps
• Finally, at 04:59 CET / 16:59 SYD, the new A$550m Kangaroo SIB deal was priced. The deal pays a coupon of 4.400%, with a reoffer price and yield of 99.782% and 4.446% s.a. respectively
• Allocations wise, EMEA-based investors took the lion’s share with 93% of allocated demand, followed by APAC (6%) and Americas (1%). Investor quality on this deal was of very high, with CB/OIs taking 84% of the transaction, followed by Banks (13%) and Fund Managers/Insurances/Pension Funds (3%).

Distribution Statistics

By geography
EMEA: 93%
APAC: 6%
Americas: 1%

By investor type
CB/OI: 84%
Banks: 13%
FM/Ins/Pens: 3%

For full technical details of the transaction, please click here.