WB Issues 1st Chinese RMB Bond

The World Bank (International Bank for Reconstruction and Development, rated Aaa/ AAA) issued today its first bond denominated in Chinese Renminbi (RMB). The RMB500 million (c.US$eq 76 million) 2-year fixed rate note due on January 14, 2013, offers investors a semi-annual coupon of 0.95%.

This is the first Renminbi bond issuance in the Hong Kong capital markets in 2011, and the World Bank's first RMB bond ever.

The transaction comes at a time when China's shareholding in the World Bank is set to increase as part of the realignment of voting shares announced in April 2010. If the realignment is formally approved and subscribed as proposed, China would become the third largest shareholder in the World Bank after the US and Japan.

The entry of the World Bank into the RMB bond market in Hong Kong will further deepen the market and permit investors to diversify their currency holdings and expand their RMB exposure. The World Bank's global reputation should also help attract the attention of many international investors who have not previously invested in RMB to this rapidly developing market.

Doris Herrera-Pol, Global Head of Capital Markets at the World Bank said: "This is a landmark transaction for the World Bank as it is the first World Bank issuance in RMB, and signals the strong interest of the World Bank in supporting the development of the RMB market. It is a privilege for us to have this opportunity that establishes the institution as a premier issuer in the fastest growing capital market in the world."

Anita Fung, Group General Manager, Head of Global Banking and Markets, Asia-Pacific, HSBC, said, "Hong Kong continues to take decisive steps in its development as an offshore RMB centre. With its global reach and international standing, the World Bank has provided Hong Kong with a landmark issuance and another strong endorsement of its evolving RMB bond market. Backed by our deep Greater China experience and international connectivity, HSBC is proud to lead the World Bank's RMB bond issuance and help drive the development of the offshore RMB market in Hong Kong."

Transaction Summary:

Issuer:                                                 World Bank

Rating:                                                 Aaa / AAA

Amount:                                              RMB 500 million

Trade Date:                                         4 January 2011

Issue Date:                                         14 January 2011

Coupon:                                              0.95% (semi-annual; act/365 (fixed))

Maturity Date:                                    14 January 2013

Issue Price:                                        100%

Listing:                                                 Unlisted

Clearing:                                              CMU with linkage to Euroclear / Clearstream

Bookrunner/Lead Manager:           HSBC

About the World Bank

The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody's/S&P), is an international organization created in 1944. It operates as a global development cooperative owned by 187 nations. It provides its members with financing, expertise and coordination services so they can achieve equitable and sustainable economic growth in their national economies and find effective solutions to pressing regional and global economic and environmental problems. The overriding goal is to achieve major, sustainable improvements in standards of living worldwide. It has been issuing bonds in the international capital markets for over 60 years to fund its activities.

Information for investors is available on the World Bank Treasury website: http://treasury.worldbank.org/capitalmarkets

(China Development Gateway January 5, 2011)