SINGAPORE-BASED Impact Investment Exchange (IIX) has closed a US$50 million, four-year bond to uplift women, in what is touted as the world’s first “orange bond” based on gender lens investing principles.
Called the Women’s Livelihood Bond 5 (WLB5), it securitises a portfolio of loans to high-impact enterprises that cannot usually access international capital markets, lead placement agent ANZ said in a Tuesday (Dec 13) press release.
The proceeds will support some 280,000 to 300,000 women across Asia and Africa to transition to “more sustainable, climate-resilient” livelihoods, the bank added.
The bond comprises US$45 million in senior and US$5 million in first-loss subordinated tranches, with a 50 per cent credit guarantee on the underlying loan portfolio by the US International Development Finance Corporation and the Swedish International Development Cooperation Agency.
ANZ has been involved in all five issuances of the Women’s Livelihood Bond thus far, totalling over US$120 million. The first was in 2017, when IIX launched the US$8.5 million WLB.
“This was the largest issuance of this series so far despite a tough environment for new issuances, driven by demand from across Asia-Pacific, Europe and the US, supported by a strong, repeat investor base. We expect this significant appetite for impact investing to continue,” said Sarah Ng, ANZ’s director for debt capital markets.
As the world’s first “orange bond”, the WLB5 balances risk, return, and impact through an innovative financial structure, said IIX CEO and founder Professor Durreen Shahnaz.