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| Name | Symbol | Market | Type |
|---|---|---|---|
| Inter 2042 | LSE:42BI | London | Medium Term Loan |
| Price Change | % Change | Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0 | - |
From Jul 2019 to Jul 2024
TIDM42BI
RNS Number : 3613B
Inter-American Development Bank
30 January 2020
PRICING SUPPLEMENT
Inter-American Development Bank
Global Debt Program
Series No.: 553
Tranche No.: 17
IDR 420,000,000,000 7.875 percent Notes due March 14, 2023 (the "Notes") as from January 29, 2020, to be consolidated and form a single series with the Bank's
IDR 950,000,000,000 7.875 percent Notes due March 14, 2023, issued on March 14, 2016 (the "Series 553 Tranche 1 Notes"), the Bank's IDR 327,250,000,000 7.875 percent Notes due March 14, 2023, issued on November 18, 2016 (the "Series 553 Tranche 2 Notes"), the Bank's IDR 334,000,000,000 7.875 percent Notes due March 14, 2023, issued on May 24, 2017 (the "Series 553 Tranche 3 Notes"), the Bank's
IDR 1,332,000,000,000 7.875 percent Notes due March 14, 2023, issued on July 27, 2017 (the "Series 553 Tranche 4 Notes"), the Bank's IDR 250,000,000,000 7.875 percent Notes due March 14, 2023, issued on September 19, 2017 (the "Series 553 Tranche 5 Notes"), the Bank's IDR 1,645,000,000,000 7.875 percent Notes due March 14, 2023, issued on November 14, 2017 (the "Series 553 Tranche 6 Notes"), the Bank's IDR 800,000,000,000 7.875 percent Notes due March 14, 2023, issued on December 7, 2017 (the "Series 553 Tranche 7 Notes"), the Bank's IDR 250,000,000,000 7.875 percent Notes due March 14, 2023, issued on December 18, 2017 (the "Series 553 Tranche 8 Notes"), the Bank's IDR 670,800,000,000 7.875 percent Notes due March 14, 2023, issued on January 24, 2018 (the "Series 553 Tranche 9 Notes"), the Bank's IDR 360,000,000,000 7.875 percent Notes due March 14, 2023, issued on July 26, 2018 (the "Series 553 Tranche 10 Notes"), the Bank's IDR 850,000,000,000 7.875 percent Notes due March 14, 2023, issued on February 20, 2019 (the "Series 553 Tranche 11 Notes"), the Bank's IDR 674,000,000,000 7.875 percent Notes due March 14, 2023, issued on March 11, 2019 (the "Series 553 Tranche 12 Notes"), the Bank's IDR 450,000,000,000 7.875 percent Notes due March 14, 2023, issued on May 22, 2019 (the "Series 553 Tranche 13 Notes"), the Bank's IDR 200,000,000,000 7.875 percent Notes due March 14, 2023, issued on June 10, 2019 (the "Series 553 Tranche 14 Notes"), the Bank's IDR 406,950,000,000 7.875 percent Notes due March 14, 2023, issued on November 22, 2019 (the "Series 553 Tranche 15 Notes"), and the Bank's IDR 1,050,000,000,000 7.875 percent Notes due March 14, 2023, issued on December 6, 2019 (the "Series 553 Tranche 16 Notes").
payable in United States Dollars
Issue Price: 106.949084 percent plus 321 days' accrued interest
Application has been made for the Notes to be admitted to the Official List of the Financial Conduct Authority and to trading on the London Stock Exchange plc's Regulated Market
J.P. Morgan
The date of this Pricing Supplement is as of January 24, 2020
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 Regulation (EU) 2017/1129). 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.
MiFID II product governance / Retail investors, professional investors and ECPs target market - See "General Information-Additional Information Regarding the Notes-Matters relating to MiFID II" below.
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.
Hot Features
Premium
1. Series No.: 553
Tranche No.: 17
2. Aggregate Principal Amount: IDR 420,000,000,000
As from the Issue Date, the
Notes will be consolidated and
form a single series with the
Series 553 Tranche 1 Notes,
the Series 553 Tranche 2 Notes,
the Series 553 Tranche 3 Notes,
the Series 553 Tranche 4 Notes,
the Series 553 Tranche 5 Notes,
the Series 553 Tranche 6 Notes,
the Series 553 Tranche 7 Notes,
the Series 553 Tranche 8 Notes,
the Series 553 Tranche 9 Notes,
the Series 553 Tranche 10 Notes,
the Series 553 Tranche 11 Notes,
the Series 553 Tranche 12 Notes,
the Series 553 Tranche 13 Notes,
the Series 553 Tranche 14 Notes,
the Series 553 Tranche 15 Notes,
and the Series 553 Tranche 16
Notes.
3. Issue Price: IDR 478,194,553,200 which amount
represents the sum of (a) 106.949084
percent of the Aggregate Principal
Amount plus (b) the amount of
IDR 29,008,400,400 representing
321 days' accrued interest,
inclusive.
The Issue Price will be payable
in USD in the amount of USD
34,930,208.41 at the agreed
rate of 13,690 IDR per one USD.
4. Issue Date: January 29, 2020
5. Form of Notes
(Condition 1(a)): Registered only, as further
provided in paragraph 9(c) of
"Other Relevant Terms" below.
6. Authorized Denomination(s)
(Condition 1(b)): IDR 10,000,000 and integral
multiples thereof
7. Specified Currency
(Condition 1(d)): The lawful currency of the
Republic of Indonesia ("Indonesian
Rupiah" or "IDR"), provided
that all payments in respect
of the Notes will be made in
United States Dollars ("U.S.$"
or "USD")
8. Specified Principal Payment
Currency
(Conditions 1(d) and 7(h)): USD
9. Specified Interest Payment
Currency USD
(Conditions 1(d) and 7(h)):
10. Maturity Date
(Condition 6(a); Fixed March 14, 2023
Interest Rate):
11. Interest Basis
(Condition 5): Fixed Interest Rate (Condition
5(I))
12. Interest Commencement Date
(Condition 5(III)): March 14, 2019
13. Fixed Interest Rate (Condition Condition 5(I) as amended and
5(I)): supplemented below, shall apply
to the Notes. The bases of the
Calculation of the Interest
Amount, Interest Payment Dates
and default interest are as
set out below.
(a) Interest Rate: 7.875 percent per annum
(b) Business Day Convention: Following Business Day Convention
(c) Fixed Rate Interest
Payment Date(s): Annually on each March 14, commencing
on March 14, 2020 and ending
on, and including, the Maturity
Date.
Each Interest Payment Date is
subject to adjustment in accordance
with the Following Business
Day Convention with no adjustment
to the amount of interest otherwise
calculated.
(d) Interest Period: Each period from and including
each Interest Payment Date to
but excluding the next following
Interest Payment Date, provided
that the initial Interest Period
will commence on and include
the Interest Commencement Date,
and the final Interest Period
will end on but exclude the
Maturity Date.
For the purposes of the calculation
of the Interest Amount payable
for any Interest Period, there
shall be no adjustment pursuant
to the Business Day Convention
specified above.
(e) Fixed Rate Day Count
Fraction(s): Actual/Actual ICMA
(f) Calculation of Interest As soon as practicable and in
Amount: accordance with the procedure
specified herein, the Calculation
Agent will determine the IDR
Rate (as defined below) and
calculate the amount of interest
payable (the "Interest Amount")
with respect to each minimum
Authorized Denomination for
the relevant Interest Period.
The Interest Amount with respect
to any Interest Period shall
be a USD amount calculated on
the relevant Rate Fixing Date
(as defined below) as follows:
7.875% times the minimum Authorized
Denomination
times
the Fixed Rate Day Count Fraction
divided by
the IDR Rate
(and rounding, if necessary,
the entire resulting figure
to the nearest two decimal places,
with USD 0.005 being rounded
upwards).
The "IDR Rate" means the rate
determined by the Calculation
Agent that is equal to the USD/IDR
weighted average spot rate in
the interbank market, based
on traded USD/IDR spot foreign
exchange transactions during
a specified time period which
are captured on a real time
basis, expressed as the amount
of IDR per one USD, for settlement
in two Fixing Business Days,
as published by Bank Indonesia
as the "Jakarta Interbank Spot
Dollar Rate USD - IDR", which
appears on Bank Indonesia's
website (www.bi.go.id), or as
published on Thomson Reuters
Screen JISDOR Page (or any replacement
page or replacement service
as may be implemented for the
purposes of displaying the USD/IDR
weighted average spot rate),
or as otherwise made available
by Bank Indonesia (or its successor
as administrator), at approximately
10:00 a.m., Jakarta time, on
the Rate Fixing Date. Fallback
Provisions apply as set out
below.
The "Rate Fixing Date" means
the date that is five (5) Fixing
Business Days prior to the applicable
Fixed Rate Interest Payment
Date or Maturity Date, as the
case may be. The Rate Fixing
Date shall be subject to adjustment
as follows: if the scheduled
date of the Rate Fixing Date
is not a Relevant Business Day,
then the Rate Fixing Date will
be the first preceding day that
is a Relevant Business Day.
"Fixing Business Day" means
a day (other than a Saturday
or a Sunday) on which banks
and foreign exchange markets
are open for business in Jakarta.
"Fallback Provisions": Should
no USD/IDR weighted average
spot rate appear on Bank Indonesia's
website (www.bi.go.id) as the
"Jakarta Interbank Spot Dollar
Rate USD - IDR", or on Thomson
Reuters Screen JISDOR Page (or
on such replacement page or
replacement service as described
above), or be otherwise made
available by Bank Indonesia
(or its successor as administrator),
on the Rate Fixing Date, then
the IDR Rate for such Rate Fixing
Date shall be determined by
the Calculation Agent by requesting
quotations for the mid USD/IDR
spot foreign exchange rate from
five banks active in the USD/IDR
currency and foreign exchange
markets as selected by the Calculation
Agent (such banks, the "Reference
Banks") either (i) at or about
10:00 a.m. Jakarta time on the
first day (other than a Saturday
or a Sunday) following the Rate
Fixing Date, if such day is
a Relevant Business Day or (ii)
at or about 10:00 a.m. Jakarta
time on the Rate Fixing Date,
if the first day (other than
a Saturday or a Sunday) following
the Rate Fixing Date is not
a Relevant Business Day.
If five or four quotations are
provided by Reference Banks
as requested, the IDR Rate shall
be the arithmetic mean (rounded
to the nearest whole IDR, with
IDR 0.5 being rounded upwards)
of the remaining three or two
such quotations (expressed as
the number of IDR per one USD),
as the case may be, after disregarding
the highest quotation and the
lowest quotation; provided,
that if two or more such quotations
are the highest such quotations,
then only one of such quotations
shall be disregarded; and provided
further, that if two or more
such quotations are the lowest
such quotations, then only one
of such lowest quotations shall
be disregarded.
If only three or two quotations
are provided as requested, the
IDR Rate shall be the arithmetic
mean (rounded to the nearest
whole IDR, with IDR 0.5 being
rounded upwards) of such quotations
(expressed as the number of
IDR per one USD).
If only one or no quotations
are provided as requested, or
if the Calculation Agent determines
in its sole discretion that
no suitable Reference Banks
active in the USD/IDR currency
or foreign exchange markets
will provide quotations, the
Calculation Agent shall be entitled
to calculate the IDR Rate acting
in good faith in a commercially
reasonable manner, having taken
into account relevant market
practice, by reference to such
additional sources as it deems
appropriate; and in such case
the Calculation Agent shall
notify the Bank and the Global
Agent as soon as reasonably
practicable that the IDR Rate
is to be so determined.
(g) Calculation Agent: See "8. Identity of Calculation
Agent" under "Other Relevant
Terms"
(h) Notification: If the Interest Amount payable
on any Fixed Rate Interest Payment
Date or the Redemption Amount,
as the case may be, is calculated
in any manner other than by
utilizing the USD/IDR reference
rate that appears on Bank Indonesia's
website (www.bi.go.id), or on
Thomson Reuters Screen JISDOR
Page (or on such replacement
page as described above), or
as otherwise made available
by Bank Indonesia (or its successor
as administrator), the Global
Agent on behalf of the Bank
shall give notice as soon as
reasonably practicable to the
Noteholders in accordance with
Condition 14 (Notices).
14. Relevant Financial Center: New York, London and Jakarta
15. Relevant Business Day: New York, London and Jakarta
16. Redemption Amount (Condition
6(a)): The Redemption Amount with respect
to each minimum Authorized Denomination
will be a USD amount calculated
by the Calculation Agent as
of the Rate Fixing Date with
respect to the Maturity Date
as follows:
minimum Authorized Denomination
divided by
the IDR Rate
(and rounding, if necessary,
the entire resulting figure
to the nearest 2 decimal places,
with USD 0.005 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
(including accrued interest, In the event the Notes become
if applicable) (Condition due and payable as provided
9): in Condition 9 (Default), the
Early Redemption Amount with
respect to each minimum Authorized
Denomination will be a USD amount
equal to the Redemption Amount
that is determined in accordance
with "16. Redemption Amount"
plus accrued and unpaid interest,
if any, as determined in accordance
with "13. Fixed Interest Rate
(Condition 5(I))"; provided,
that for purposes of such determination,
the "Rate Fixing Date" shall
be the date that is five Fixing
Business Days prior to the date
upon which the Notes become
due and payable as provided
in Condition 9 (Default).
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.
(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 the Notes in, from or otherwise
involving the United Kingdom.
(c) Indonesia: The Notes are not and will not
be registered with the Financial
Services Authority previously
known as the Capital Market
and Financial Institutions Supervisory
Agency (the "OJK") in Indonesia.
As such, the Notes (including
the distribution and dissemination
of the Pricing Supplement, other
written materials either through
advertisements or other media
authorized) are not authorized
by the OJK for their sale by
public offering in the Indonesian
territory and/or to Indonesian
entities or residents in the
Indonesian territory in circumstances
which constitute a public offering
of securities under the Indonesian
Law No. 8/1995 regarding Capital
Markets. Likewise, the Notes
and the Pricing Supplement have
not been reviewed, registered
or authorized by the Central
Bank (Bank Indonesia) for their
distribution through banking
institutions in Indonesia.
(d) General: No action has been or will be
taken by the Issuer 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.
Other Relevant Terms
1. Listing: Application has been made for
the Notes to be admitted to
the Official List of the Financial
Conduct Authority and to trading
on the London Stock Exchange
plc's Regulated Market.
2. Details of Clearance System
Approved by the Bank and
the
Global Agent and Clearance Euroclear Bank SA/NV and Clearstream
and Banking S.A.
Settlement Procedures:
3. Syndicated: No
4. Commissions and Concessions: 0.029428% of the Aggregate Principal
Amount
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: 137749645
(b) ISIN: XS1377496457
7. Identity of Dealer: J.P. Morgan Securities plc
8. Identity of Calculation The Toronto-Dominion Bank, Toronto
Agent:
In relation to the Rate Fixing
Date, as soon as is reasonably
practicable after the determination
of the IDR Rate in relation
thereto, on the date on which
the relevant IDR Rate is to
be determined (or, if such date
is not a Relevant Business Day,
then on the next succeeding
Relevant Business Day), the
Calculation Agent shall notify
the Issuer and the Global Agent
of the IDR Rate, and the Interest
Amount, and the Redemption Amount
or Early Redemption Amount,
as the case may be, in relation
thereto.
All determinations of the Calculation
Agent shall (in the absence
of manifest error) 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.
9. Provision for Registered
Notes:
(a) Individual Definitive
Registered Notes Available No
on Issue Date:
(b) DTC Global Note(s): No
(c) Other Registered Global Yes, issued in accordance with
Notes: the Global Agency Agreement,
dated January 8, 2001, among
the Bank, Citibank, N.A., as
Global Agent, and the other
parties thereto.
General Information
Additional Information Regarding the Notes
1. Matters relating to MiFID II
The Bank does not fall under the scope of application of the MiFID II regime. Consequently, the Bank does not qualify as an "investment firm", "manufacturer" or "distributor" for the purposes of MiFID II.
MiFID II product governance / Retail investors, professional investors and ECPs target market - Solely for the purposes of the manufacturer's product approval process, the target market assessment in respect of the Notes has led to the conclusion that: (i) the target market for the Notes is eligible counterparties, professional clients and retail clients, each as defined in MiFID II; and (ii) all channels for distribution of the Notes are appropriate. Any person subsequently offering, selling or recommending the Notes (a "distributor") should take into consideration the manufacturer's target market assessment; however, a distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the Notes (by either adopting or refining the manufacturer's target market assessment) and determining appropriate distribution channels.
For the purposes of this provision, the expression MiFID II means Directive 2014/65/EU, as amended.
2. United States Federal Income Tax Matters
The following supplements the discussion under the "Tax Matters" section of the Prospectus regarding the U.S. federal income tax treatment of the Notes, and is subject to the limitations and exceptions set forth therein. Any tax disclosure in the Prospectus or this pricing supplement is of a general nature only, is not exhaustive of all possible tax considerations and is not intended to be, and should not be construed to be, legal, business or tax advice to any particular prospective investor. Each prospective investor should consult its own tax advisor as to the particular tax consequences to it of the acquisition, ownership, and disposition of the Notes, including the effects of applicable U.S. federal, state, and local tax laws and non-U.S. tax laws and possible changes in tax laws.
Subject to the discussion below regarding amortizable bond premium, a United States holder will generally be taxed on interest on the Notes as ordinary income at the time such holder receives the interest or when it accrues, depending on the holder's method of accounting for tax purposes. However, the portion of the first interest payment on the Notes that represents a return of the 321 days of accrued interest that a United States holder paid as part of the Issue Price of the Notes ("Pre-Issuance Accrued Interest") will not be treated as an interest payment for United States federal income tax purposes, and will accordingly only be taxable to the extent that the U.S. dollar amount received in respect of such Pre-Issuance Accrued Interest differs from the U.S. dollar amount paid by the holder in respect of such interest. Any such difference should give rise to United States source foreign currency gain or loss.
Because the Notes are denominated in the Indonesian Rupiah, a United States holder of the Notes will generally be subject to special United States federal income tax rules governing foreign currency transactions, as described in the Prospectus in the last four paragraphs of "-Payments of Interest" under the "United States Holders" section. Pursuant to such rules, a United States holder should determine amounts received with respect to a Note (including principal and interest) by reference to the U.S. dollar value of the Indonesian Rupiah amount of the payment, calculated at the currency exchange rate in effect on the date of payment. The U.S. dollar amount that is actually received by the United States holder may differ from the amount determined under the preceding sentence, since the U.S. dollar amount of the payment will be determined by reference to the IDR Rate as of the relevant Rate Fixing Date. Accordingly, a United States holder of the Notes may recognize United States source foreign currency gain or loss in an amount equal to such difference (in addition to any foreign currency gain or loss otherwise recognized upon the receipt of an interest payment or a sale or retirement of the Notes). The U.S. Internal Revenue Service ("IRS") could take the position, however, that the amounts received by a United States holder in respect of a Note should be equal to the U.S. dollar amount that is actually received by the United States holder. Prospective United States holders of the Notes should consult their tax advisors regarding these rules.
Additionally, because the purchase price of the Notes exceeds the principal amount of the Notes, a United States holder may elect to treat the excess (after excluding the portion of the purchase price attributable to Pre-Issuance Accrued Interest) as amortizable bond premium. A United States holder that makes this election would reduce the amount required to be included in such holder's income each year with respect to interest on the Notes by the amount of amortizable bond premium allocable to that year, based on the Note's yield to maturity. Because the Notes are denominated in the Indonesian Rupiah, a United States holder would compute such holder's amortizable bond premium in units of Indonesian Rupiah, and the United States holder's amortizable bond premium would reduce such holder's interest income in units of Indonesian Rupiah. Gain or loss recognized that is attributable to changes in exchange rates between the time the United States holder's amortized bond premium offsets interest income and the time of the holder's acquisition of the Notes is generally taxable as ordinary income or loss. If a United States holder makes an election to amortize bond premium, the election would apply to all debt instruments, other than debt instruments the interest on which is excludible from gross income, that the United States holder holds at the beginning of the first taxable year to which the election applies or that such holder thereafter acquires, and the United States holder may not revoke the election without the consent of the IRS.
Upon a sale, redemption or retirement of a Note, a United States holder will generally recognize gain or loss equal to the difference, if any, between (i) the U.S. dollar value of the amount realized on the sale, redemption or retirement (other than amounts attributable to accrued but unpaid interest, which would be treated as interest payments except to the extent that such amounts are a return of Pre-Issuance Accrued Interest), and (ii) the United States holder's adjusted tax basis in the Note. A United States holder's adjusted tax basis in a Note generally will equal the U.S. dollar cost of the Note to the United States holder, reduced by any bond premium that the United States holder previously amortized with respect to the Notes, and if such disposition occurs after the first interest payment, by an amount equal to the U.S. dollar value of the Pre-Issuance Accrued Interest on the Issue Date. Such gain or loss will be capital gain or loss except to the extent attributable to changes in exchange rates. Capital gain of individual taxpayers from the sale, redemption or retirement of a Note held for more than one year may be eligible for reduced rates of taxation. The deductibility of a capital loss is subject to significant limitations.
Due to a change in law since the date of the Prospectus, the second paragraph of "-Payments of Interest" under the "United States Holders" section should be updated to read as follows: "Interest paid by the Bank on the Notes constitutes income from sources outside the United States and will generally be "passive" income for purposes of computing the foreign tax credit."
Treasury Regulations Requiring Disclosure of Reportable Transactions. Treasury regulations require United States taxpayers to report certain transactions that give rise to a loss in excess of certain thresholds (a "Reportable Transaction"). Under these regulations, because the Notes are denominated in a foreign currency, a United States holder (or a non-United States holder that holds the Notes in connection with a U.S. trade or business) that recognizes a loss with respect to the Notes that is characterized as an ordinary loss due to changes in currency exchange rates (under any of the rules discussed above or under the "Tax Matters" section of the Prospectus) would be required to report the loss on IRS Form 8886 (Reportable Transaction Statement) if the loss exceeds the thresholds set forth in the regulations. For individuals and trusts, this loss threshold is $50,000 in any single taxable year. For other types of taxpayers and other types of losses, the thresholds are higher. Holders should consult with their tax advisors regarding any tax filing and reporting obligations that may apply in connection with acquiring, owning and disposing of notes.
Information with Respect to Foreign Financial Assets. Owners of "specified foreign financial assets" with an aggregate value in excess of U.S.$50,000 (and in some circumstances, a higher threshold) may be required to file an information report with respect to such assets with their tax returns. "Specified foreign financial assets" may include financial accounts maintained by foreign financial institutions, as well as the following, but only if they are held for investment and not held in accounts maintained by financial institutions: (i) stocks and securities issued by non-United States persons, (ii) financial instruments and contracts that have non-United States issuers or counterparties, and (iii) interests in foreign entities. Holders are urged to consult their tax advisors regarding the application of this reporting requirement to their ownership of the Notes.
Medicare Tax. A United States holder that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax (the "Medicare tax") on the lesser of (1) the United States holder's "net investment income" (or "undistributed net investment income" in the case of an estate or trust) for the relevant taxable year and (2) the excess of the United States holder's modified adjusted gross income for the taxable year over a certain threshold (which in the case of individuals is between U.S.$125,000 and U.S.$250,000, depending on the individual's circumstances). A holder's net investment income generally includes its interest income, foreign currency gain and its capital gains from the disposition of Notes, unless such interest income or gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). United States holders that are individuals, estates or trusts are urged to consult their tax advisors regarding the applicability of the Medicare tax to their income and gains in respect of their investment in the Notes.
3. Additional Investment Considerations:
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.
There are various risks associated with the Notes including, but not limited to, exchange rate risk, price risk and liquidity risk. Investors should consult with their own financial, legal and accounting 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. Holders of the Notes should also consult with their professional tax advisors regarding tax laws applicable to them.
Payment of each Interest Amount and the Redemption Amount will be based on the IDR Rate, which is a measure of the rate of exchange between the Indonesian Rupiah and the USD. Currency exchange rates are volatile and will affect the holder's return. In addition, the government of Indonesia can from time to time intervene in the foreign exchange market. These interventions or other governmental actions could adversely affect the value of the Notes, as well as the yield (in USD terms) on the Notes and the amount payable at maturity or upon acceleration. Even in the absence of governmental action directly affecting currency exchange rates, political or economic developments in Indonesia or elsewhere could lead to significant and sudden changes in the exchange rate between the Indonesian Rupiah and the USD.
The Indonesian Rupiah is an emerging market currency. Emerging market currencies may be subject to particularly substantial volatility, as well as to government actions including currency controls, devaluations and other matters which could materially and adversely affect the value of the Notes.
The methodologies for determining the IDR Rate may result in a Redemption Amount (or Early Redemption Amount, as the case may be) of the Notes, or an Interest Amount on the Notes, being significantly less than anticipated or less than what an alternative methodology for determining the IDR-USD exchange rate would yield.
INTER-AMERICAN DEVELOPMENT BANK
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
IODUKAURRUUAUUR
(END) Dow Jones Newswires
January 30, 2020 02:00 ET (07:00 GMT)
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