YEREVAN, December 23. / ARKA /. IFC, a member of the World Bank Group, said today it has issued a 2 billion dram (approximately $5 million) bond to strengthen Armenia’s capital markets and boost lending to the private sector.

The bond is IFC’s first dram issuance. It is also the first placement by a non-resident issuer and the first foreign corporate bond issued in Armenia’s capital markets.

Named Sevan, after Armenia’s largest lake, the bond is part of an 8 billion dram bond program under which IFC can issue bonds when market opportunities align with the funding needs of the country’s private sector.

“Deep, liquid domestic capital markets are the foundations of lasting growth and shared prosperity because they create access to finance for the private sector,” said Jingdong Hua, IFC Vice President and Treasurer.

“IFC is committed to supporting the development of the domestic markets in Armenia. We hope that this bond will send a clear signal to other high quality foreign issuers that Armenia is ready to welcome them.”

Most of the bond investors are Armenian financial institutions, which in turn support private sector development in Armenia.

“The IFC Sevan bond offers a high-quality investment alternative for institutional investors and makes available funds that can be put to work in the local economy,” said Thomas Lubeck, IFC Regional Manager for the South Caucasus, said. “IFC is happy to support the deepening of Armenian capital markets.”

HSBC Bank Armenia CJSC and Ameriabank CJSC acted as lead managers for the bond.
Over the years, IFC has issued bonds in 14 local currencies, including the Brazilian real, the Chinese renminbi, the Nigeria naira, and the Russia ruble. Often, IFC is the first international or corporate issuer of local-currency bonds in a market.

When issuing local-currency bonds, IFC works closely with regulators and market participants to refine the regulatory framework, encouraging greater participation in the local markets and providing a model for other international issuers.

Armenia became a member and a shareholder of IFC in 1995. Since then, IFC has invested around $271 million in 44 projects across a range of sectors, including financial markets, manufacturing, and mining. IFC advisory services provide advice on the financial sector, sustainable energy, business regulations, and food safety.

IFC Sevan Bond Summary Terms and Conditions
Issue amount: AMD 2 billion (approximately $5 million equivalent)
Pricing date: December 23, 2013
Settlement date: December 23, 2013
Maturity date: December 23, 2016
Coupon: 9.70%
Coupon Frequency: Semi-annual
Repayment: Bullet on maturity date

IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity.

In FY13, its investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. -0-