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Inter 2042 | LSE:42BI | London | Medium Term Loan |
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TIDM42BI
RNS Number : 4121Q
Inter-American Development Bank
05 June 2018
PRICING SUPPLEMENT
Inter-American Development Bank
Global Debt Program
Series No.: 648
INR 590,000,000 5.01 percent Notes due June 10, 2021 (the "Notes") Payable in Japanese Yen
Issue Price: 100.00 percent
No application has been made to list the Notes on any stock exchange.
Tokai Tokyo Securities Europe Limited
The date of this Pricing Supplement is May 30, 2018.
Terms used herein shall be deemed to be defined as such for the purposes of the Terms and Conditions (the "Conditions") set forth in the Prospectus dated January 8, 2001 (the "Prospectus") (which for the avoidance of doubt does not constitute a prospectus for the purposes of Part VI of the United Kingdom Financial Services and Markets Act 2000 or a base prospectus for the purposes of Directive 2003/71/EC of the European Parliament and of the Council). This Pricing Supplement must be read in conjunction with the Prospectus. This document is issued to give details of an issue by the Inter-American Development Bank (the "Bank") under its Global Debt Program and to provide information supplemental to the Prospectus. Complete information in respect of the Bank and this offer of the Notes is only available on the basis of the combination of this Pricing Supplement and the Prospectus.
Terms and Conditions
The following items under this heading "Terms and Conditions" are the particular terms which relate to the issue the subject of this Pricing Supplement. These are the only terms which form part of the form of Notes for such issue.
1. Series No.: 648 2. Aggregate Principal Amount: INR 590,000,000 3. Issue Price: 100.00 percent of the Aggregate Principal Amount. The Issue Price will be payable in Japanese Yen ("JPY") being the lawful currency of Japan, in the amount of JPY 945,829,000 at the agreed rate of JPY 1.6031 per one INR. 4. Issue Date: June 4, 2018 5. Form of Notes (Condition 1(a)): Bearer only. The Notes will initially be represented by a temporary global note in bearer form (the "Temporary Bearer Global Note"). Interests in the Temporary Bearer Global Note will, not earlier than the Exchange Date, be exchangeable for interests in a permanent global note in bearer form (the "Permanent Bearer Global Note"). Interests in the Permanent Bearer Global Note will be exchangeable for definitive notes in bearer form ("Definitive Bearer Notes"), with all Coupons in respect of interest attached, in the following circumstances: (i) if the Permanent Bearer Global Note is held on behalf of a clearing system and such clearing system is closed for business for a continuous period of fourteen (14) days (other than by reason of holidays, statutory or otherwise) or announces its intention to permanently cease business or does in fact do so, by any such holder giving written notice to the Global Agent; and (ii) at the option of any such holder upon not less than sixty (60) days' written notice to the Bank and the Global Agent from Euroclear and Clearstream, Luxembourg on behalf of such holder; provided that no such exchanges will be made by the Global Agent, and no Noteholder may require such an exchange, during a period of fifteen (15) days ending on the due date for any payment of principal on the Notes. 6. Authorized Denomination(s) (Condition 1(b)): INR 100,000 7. Specified Currency (Condition 1(d)): Indian Rupee ("INR") (the lawful currency of the Republic of India); provided that all payments in respect of the Notes will be made in JPY 8. Specified Principal Payment Currency (Conditions 1(d) and 7(h)): JPY 9. Specified Interest Payment Currency JPY (Conditions 1(d) and 7(h)): 10. Maturity Date (Condition 6(a); Fixed June 10, 2021 Interest Rate): The Maturity Date is subject to adjustment in accordance with the Modified Following Business Day Convention with no adjustment to the amount of interest otherwise calculated. 11. Interest Basis (Condition 5): Fixed Interest Rate (Condition 5(I)) 12. Interest Commencement Date (Condition 5(III)): June 5, 2018 13. Fixed Interest Rate (Condition 5(I)): (a) Interest Rate: 5.01 percent per annum (b) Fixed Rate Interest Payment Date(s): Semi-annually on June 10 and December 10 in each year, commencing on December 10, 2018 and ending on the Maturity Date. Each Fixed Rate Interest Payment Date is subject to adjustment in accordance with the Modified Following Business Day Convention with no adjustment to the amount of interest otherwise calculated. Calculation of Interest Amount As soon as practicable and in accordance with the procedures
specified herein, the Calculation Agent (as defined below) will determine the Reference Rate (as defined below) and calculate the amount of interest payable (the "Interest Amount") with respect to each Authorized Denomination for the relevant Interest Period. The Interest Amount with respect to any Interest Period shall be a JPY amount calculated on the relevant Rate Fixing Date (as defined below) as follows: With respect to the first Interest Period, INR 2,574.58 multiplied by the Reference Rate; and With respect to each subsequent Interest Period, INR 2,505.00 multiplied by the Reference Rate (and, in each case, rounding, if necessary, the entire resulting figure to the nearest whole JPY, with JPY 0.5 being rounded upwards). Where: "Reference Rate" means the product of 100 and the reciprocal number of the RBIC Rate on each Rate Fixing Date. The resulting figure (expressed as the number of JPY per one INR) shall be rounded to four decimal places with 0.00005 being rounded upwards. "RBIC Rate" is the spot JPY/INR foreign exchange rate, (expressed as the number of INR per 100 JPY) as reported by the Reserve Bank of India and as published on Reuters Screen "RBIC" Page, or such other page or services that may replace any such page for the purpose of displaying the reference JPY/INR exchange rate, at approximately 1:30 p.m. (India Standard Time), or as soon thereafter as practicable. "Rate Fixing Date" means the date that is 5 Relevant Business Days prior to the relevant Interest Payment Date and Maturity Date or the date upon which the Notes become due and payable pursuant to Condition 9 (Default), subject to no adjustment by any Business Day Convention. Provided that if there is an Unscheduled Holiday between the relevant Rate Fixing Date and relevant date of payment, such Rate Fixing Date shall not be subject to adjustment. "Unscheduled Holiday" means a day that is not a Mumbai Business Day and this fact was not publically known to market participants (by means of a public announcement or by reference to other publicly available information) until a time later than 9:00 a.m. local time in Mumbai, two Mumbai Business Days prior to the relevant Rate Fixing Date. "Mumbai Business Day" means a day (other than a Saturday or a Sunday ) on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in Mumbai. "Price Source Disruption Event" means the event that the RBIC Rate is not available for any reason on Reuters Screen "RBIC" Page or any successor page on the relevant Rate Fixing Date. If Price Source Disruption Event occurs, then the Reference Rate shall be determined in the following order of Fallback Provision. "Fallback Provision" (a) The Reference Rate shall be calculated by dividing the USD/JPY_fx by the USD/INR_fx and provided that such number (expressed as the number of JPY per one INR) shall be rounded to four decimal places with 0.00005 being rounded upwards. USD/JPY_fx: The arithmetic mean of bid and offered rate for USD/JPY (expressed as the number of JPY per one USD) as of 3:00 p.m. Tokyo time on the relevant Rate Fixing Date, which appears under the heading "DLR/YEN" column on
Reuters Screen "TKFE" Page, or any successor page as the case may be. USD/INR_fx: The spot USD/INR foreign exchange rate, (expressed as the number of INR per one USD), for settlement in two Mumbai Business Days reported by the Reserve Bank of India which appears on Reuters Screen "RBIB" Page , or any successor page as the case may be, on the relevant Rate Fixing Date. (b) If USD/JPY_fx is not available on the relevant Rate Fixing Date, the Calculation Agent will request five leading reference banks (selected by the Calculation Agent at its sole discretion) in the Tokyo interbank market for their mid market quotations of the USD/JPY spot exchange rate at approximately 3:00 p.m. Tokyo time on such date. The highest and the lowest of such quotations will be disregarded and the arithmetic mean of the remaining three quotations will be USD/JPY_fx. Provided that, if only four quotations are so provided, then USD/JPY_fx shall be the arithmetic mean of such quotations without regard to the highest and lowest values quoted. If fewer than four quotations but at least two quotations can be obtained then USD/JPY_fx shall be the arithmetic mean of the quotations actually obtained by the Calculation Agent. If only one quotation is available, in that event, the Calculation Agent may determine that such quotation shall be USD/JPY_fx, and if no such quotation is available or if the Calculation Agent determines in its sole discretion that no suitable reference bank who is prepared to quote is available, USD/JPY_fx shall be determined by the Calculation Agent in good faith. (c) If USD/INR_fx is not available on the relevant Rate Fixing Date, the Calculation Agent will request five leading reference banks (selected by the Calculation Agent at its sole discretion) which regularly deal in the USD/INR exchange market, for their market quotations of the USD/INR spot exchange rate on such date. The highest and the lowest of such quotations will be disregarded and the arithmetic mean of the remaining three quotations will be USD/INR_fx. Provided that, if only four quotations are so provided, then USD/INR_fx shall be the arithmetic mean of such quotations without regard to the highest and lowest values quoted. If fewer than four quotations but at least two quotations can be obtained then USD/INR_fx shall be the arithmetic mean of the quotations actually obtained by the Calculation Agent. If only one quotation is available, in that event, the Calculation Agent may determine that such quotation shall be USD/INR_fx, and if no such quotation is available or if the Calculation Agent determines in its sole discretion that no suitable reference bank who is prepared to quote is available, USD/INR_fx shall be determined by the Calculation Agent in good faith. (d) Provided further that, if Rate Fixing Date falls on an Unscheduled Holiday, the USD/INR_fx will be determined by the Calculation Agent on such Rate Fixing Date in its sole discretion, acting in good faith and in a commercially reasonable manner. "Calculation Agent" means JPMorgan Chase Bank, N.A.. All determinations of the Calculation Agent shall (in the absence of manifest error, willful default or fraud) be final and binding on all parties (including, but not limited to, the Bank and the
Noteholders) and shall be made in its sole discretion in good faith and in a commercially reasonable manner in accordance with a calculation agent agreement between the Bank and the Calculation Agent. (c) Fixed Rate Day Count Fraction(s): 30/360 14. Relevant Financial Center: Tokyo 15. Relevant Business Day: New York, Tokyo, London and Mumbai 16. Redemption Amount (Condition The Redemption Amount with respect 6(a)): to each Authorized Denomination will be a JPY amount calculated by the Calculation Agent on the Rate Fixing Date with respect to the Maturity Date as follows: INR 100,000 multiplied by the Reference Rate (rounding, if necessary, the entire resulting figure to the nearest whole JPY, with JPY 0.5 being rounded upwards). 17. Issuer's Optional Redemption (Condition 6(e)): No 18. Redemption at the Option of the Noteholders (Condition No 6(f)): 19. Early Redemption Amount In the event the Notes become (including accrued interest, due and payable as provided if applicable) (Condition in Condition 9 (Default), the 9): Early Redemption Amount with respect to each Authorized Denomination will be a JPY amount equal to the Redemption Amount that is determined in accordance with Term 16 herein ("16. Redemption Amount (Condition 6(a))") (with the words "Maturity Date" in such Term 16 replaced by the words "day on which the Early Redemption Amount shall be due and payable as provided in Condition 9") plus accrued and unpaid interest, if any, as determined in accordance with Term 13 herein ("13. Fixed Interest Rate (Condition 5(I))"). 20. Governing Law: New York 21. Selling Restrictions: (a) United States: Under the provisions of Section 11(a) of the Inter-American Development Bank Act, the Notes are exempted securities within the meaning of Section 3(a)(2) of the U.S. Securities Act of 1933, as amended, and Section 3(a)(12) of the U.S. Securities Exchange Act of 1934, as amended. Notes in bearer form are subject to U.S. tax law requirements and may not be offered, sold or delivered within the United States or its possessions or to U.S. persons, except in certain circumstances permitted by U.S. tax regulations. (b) United Kingdom: The Dealer represents and agrees that it has complied and will comply with all applicable provisions of the Financial Services and Markets Act 2000 with respect to anything done by it in relation to such Notes in, from or otherwise involving the United Kingdom. (c) Republic of India: The Dealer acknowledges that, it will not offer or sell any Notes in India at any time. The Notes have not been approved by the Securities and Exchange Board of India, Reserve Bank of India or any other regulatory authority of India, nor have the foregoing authorities approved this Pricing Supplement or confirmed the accuracy or determined the adequacy of the information contained in this Pricing Supplement. This Pricing Supplement has not been and will not be registered as a prospectus or a statement in lieu of prospectus with the Registrar of Companies in India. (d) Japan: The Dealer acknowledges that a secondary distribution (Uridashi) of the Notes is scheduled to be made in Japan and represents that it is purchasing the Notes as principal and has agreed that in connection with the initial offering of Notes, it has not offered or sold and will not directly or indirectly offer or sell any Notes in Japan or to, or for the benefit of, any resident of Japan (including any Japanese corporation or any other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to,
or for the benefit of, any resident of Japan (except in compliance with the Financial Instruments and Exchange Law of Japan (Law no. 25 of 1948, as amended) and all other applicable laws and regulations of Japan), and furthermore undertakes that any securities dealer to whom it sells any Notes will agree that it is purchasing the Notes as principal and that it will not offer or sell any Notes, directly or indirectly, in Japan or to or for the benefit of any resident of Japan (except as aforesaid). (e) General: No action has been or will be taken by the Bank that would permit a public offering of the Notes, or possession or distribution of any offering material relating to the Notes in any jurisdiction where action for that purpose is required. Accordingly, the Dealer agrees that it will observe all applicable provisions of law in each jurisdiction in or from which it may offer or sell Notes or distribute any offering material. 22. Amendment to Condition 7(a)(i): Condition 7(a)(i) is hereby amended by deleting the first sentence thereof and replacing it with the following: "Payments of principal and interest in respect of Registered Notes shall be made to the person shown on the Register at the close of business on the business day before the due date for payment thereof (the "Record Date")." 23. Amendment to Condition 7(h): The following shall apply to Notes any payments in respect of which are payable in a Specified Currency other than United States Dollars: Condition 7(h) is hereby amended by deleting the words "the noon buying rate in U.S. dollars in the City of New York for cable transfers for such Specified Currency as published by the Federal Reserve Bank of New York on the second Business Day prior to such payment or, if such rate is not available on such second Business Day, on the basis of the rate most recently available prior to such second Business Day" and replacing them with the words "a U.S. dollar/Specified Currency exchange rate determined by the Calculation Agent as of the second Business Day prior to such payment, or, if the Calculation Agent determines that no such exchange rate is available as of such second Business Day, on the basis of the exchange rate most recently available prior to such second Business Day. In making such determinations, the Calculation Agent shall act in good faith and in a commercially reasonable manner having taken into account all available information that it shall deem relevant". If applicable and so appointed, and unless otherwise defined herein, the "Calculation Agent" referred to in amended Condition 7(h) shall be the Global Agent under the Bank's Global Debt Program - namely, Citibank, N.A., London Branch, or its duly authorized successor. Other Relevant Terms 1. Listing: None 2. Details of Clearance System Approved by the Bank and the Global Agent and Clearance Euroclear Bank S.A./N.V. and/or and Clearstream, Luxembourg Settlement Procedures: 3. Syndicated: No 4. Commissions and Concessions: No commissions or concessions are payable in respect of the Notes. The Dealer or one of its affiliates has arranged a swap with the Bank in connection with this transaction and will receive amounts thereunder that may comprise compensation. 5. Estimated Total Expenses: None. The Dealer has agreed to pay for all material expenses related to the issuance of the Notes. 6. Codes: (a) Common Code: 181871121
(b) ISIN: XS1818711217 7. Identity of Dealer: Tokai Tokyo Securities Europe Limited 8. Identity of Calculation JPMorgan Chase Bank, N.A. Agent: 9. Provisions for Bearer Notes: (a) Exchange Date: Not earlier than July 14, 2018, which is the date that is 40 (forty) days after the Issue Date. (b) Permanent Global Note: Yes (c) Definitive Bearer Notes: No, except in the limited circumstances described under "Form of Notes" herein and in the Prospectus (d) Individual Definitive Registered Notes: No (e) Registered Global Notes: No
General Information
IDB Statement on Venezuela
On May 14, Venezuela passed the Bank's 180-day limit for payment arrears for an amount of $88.3 million, placing the country in a non-accrual status.
Venezuela's total loan arrears, including those that have not yet reached the 180-day limit, stand at $212.4 million on a total debt of $2.011 billion. Venezuela's debt to the IDB represents 1.6% of the Bank's total assets as of March 31, 2018.
Under the IDB's guidelines on arrears, the Bank cannot undertake any lending activities concerning Venezuela until its arrears are cleared. As a matter of policy, the Bank does not reschedule its sovereign-guaranteed loans.
The IDB does not expect Venezuela's non-accrual event to affect the Bank's 2018 liquidity and capital ratios, which remain strong and in full compliance with its financial policies. The IDB anticipates that the event will not affect its 2018 lending program.
Venezuela, which became a shareholder of the IDB when the institution was founded in 1959, has reiterated its commitment to the IDB and its intention to undertake regular payments. The IDB acknowledges Venezuela's efforts and will continue to work with its government to resolve the arrears.
Additional Information Regarding the Notes
1. Additional Investment Considerations:
There are significant risks associated with the Notes, including but not limited to exchange rate risk, price risk and liquidity risk. Investors should consult their own financial, legal, accounting and tax advisors about the risks associated with an investment in these Notes, the appropriate tools to analyze that investment, and the suitability of the investment in each investor's particular circumstances.
The methodologies for determining the Japanese Yen-Indian Rupee foreign exchange rate may result in a Redemption Amount of the Notes, or an interest payment on the Notes, being significantly less than anticipated.
The Bank may hedge its obligations under the Notes by entering into a swap transaction with the Dealer or one of its affiliates as swap counterparty. Assuming no change in market conditions or any other relevant factors, the price, if any, at which the Dealer or another purchaser might be willing to purchase Notes in a secondary market transaction is expected to be lower, and could be substantially lower, than the original issue price of the Notes. This is due to a number of factors, including that (i) the potential profit to the secondary market purchaser of the Notes may be incorporated into any offered price and (ii) the cost of funding used to value the Notes in the secondary market is expected to be higher than our actual cost of funding incurred in connection with the issuance of the Notes. In addition, the original issue price of the Notes included, and secondary market prices are likely to exclude, the projected profit that our swap counterparty or its affiliates may realize in connection with this swap. Further, as a result of dealer discounts, mark-ups or other transaction costs, any of which may be significant, the original issue price may differ from values determined by pricing models used by our swap counterparty or other potential purchasers of the Notes in secondary market transactions.
The Notes offered by this Pricing Supplement are complex financial instruments and may not be suitable for certain investors. Investors intending to purchase the Notes should consult with their tax and financial advisors to ensure that the intended purchase meets the investment objective before making such purchase.
TER-AMERICAN DEVELOPMENT BANK
By:
Name: Gustavo Alberto De Rosa
Title: Chief Financial Officer and
General Manager, Finance Department
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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