TIDM42BI
RNS Number : 5813F
Inter-American Development Bank
19 July 2021
PRICING SUPPLEMENT
Inter-American Development Bank
Global Debt Program
Series No: 729
Tranche No.: 3
GBP 135,000,000 0.500 percent Notes due September 15, 2026 (the
"Notes") as from July 16, 2021 to be consolidated and form a single
series with the Bank's GBP 275,000,000 0.500 percent Notes due
September 15, 2026, issued on October 22, 2019 (the "Series 729
Tranche 1 Notes") and the Bank's GBP 250,000,000 0.500 percent
Notes due September 15, 2026, issued on June 25, 2020 (the "Series
729 Tranche 2 Notes")
Issue Price: 99.564 percent plus 304 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
UK Regulated Market
RBC Capital Markets
The date of this Pricing Supplement is July 13, 2021.
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 ("UK") Financial Services
and Markets Act 2000 or a base prospectus for the purposes of
Regulation (EU) 2017/1129 (as amended, the "Prospectus Regulation")
or the Prospectus Regulation as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 ("EUWA")). 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.
UK MiFIR product governance / Retail investors, professional
investors and ECPs target market - See "General
Information-Additional Information R egarding the Notes-Matters
relating to UK MiFIR" 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.
1. (a) Series No.: 729
(b) Tranche No.: 3
2. Aggregate Principal Amount: GBP 135,000,000
As from the Issue Date, the Notes
will be consolidated and form a
single series with the Series 729
Tranche 1 Notes and the Series 729
Tranche 2 Notes.
3. Issue Price: GBP 134,973,591.78, which amount
represents the sum of (a) 99.564
percent of the Aggregate Principal
Amount plus (b) the amount of GBP
562,191.78 representing 304 days'
accrued interest, inclusive.
4. Issue Date: July 16, 2021
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)): GBP 1,000 and integral multiples
thereof
7. Specified Currency
(Condition 1(d)): Pound sterling ("GBP") being the
lawful currency of the United Kingdom
of Great Britain and Northern Ireland
8. Specified Principal Payment
Currency
(Conditions 1(d) and 7(h)): GBP
9. Specified Interest Payment
Currency GBP
(Conditions 1(d) and 7(h)):
10. Maturity Date
(Condition 6(a); Fixed September 15, 2026
Interest Rate):
11. Interest Basis
(Condition 5): Fixed Interest Rate (Condition
5(I))
12. Interest Commencement Date
(Condition 5(III)): September 15, 2020
13. Fixed Interest Rate (Condition
5(I)):
(a) Interest Rate: 0.500 percent per annum
(b) Fixed Rate Interest
Payment Date(s): Annually in arrear on September
15 in each year, commencing on September
15, 2021, up to 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.
(c) Fixed Rate Day Count
Fraction(s): Actual/Actual (ICMA)
14. Relevant Financial Center: London and New York
15. Relevant Business Days: London and New York
16. Issuer's Optional Redemption
(Condition 6(e)): No
17. Redemption at the Option
of the Noteholders (Condition No
6(f)):
18. Governing Law: New York
19. 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 (a) it has only communicated
or caused to be communicated and
will only communicate or cause to
be communicated an invitation or
inducement to engage in investment
activity (within the meaning of
Section 21 of the Financial Services
and Markets Act 2000 (the "FSMA"))
received by it in connection with
the issue or sale of the Notes in
circumstances in which Section 21(1)
of the FSMA does not apply to the
Bank, and (b) it has complied and
will comply with all applicable
provisions of the FSMA with respect
to anything done by it in relation
to such Notes in, from or otherwise
involving the UK.
(c) Singapore: In the case of the Notes being offered
into Singapore in a primary or subsequent
distribution, and solely for the
purposes of its obligations pursuant
to Section 309B of the Securities
and Futures Act (Chapter 289) of
Singapore (the "SFA"), the Issuer
has determined, and hereby notifies
all relevant persons (as defined
in Section 309A of the SFA) that
the Notes are "prescribed capital
markets products" (as defined in
the Securities and Futures (Capital
Markets Products) Regulations 2018
of Singapore) and Excluded Investment
Products (as defined in MAS Notice
SFA 04-N12: Notice on the Sale of
Investment Products and MAS Notice
FAA-N16: Notice on Recommendations
on Investment Products).
(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.
20. 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")."
21. 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 Globa l Agent
un d er the
Bank's Global Debt Program - namely
,
Citibank, N.A., London Branch ,
or its duly authorized successor.
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 UK Regulated Market
with effect from the Issue Date.
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: 0.0373% of the Aggregate Principal
Amount
5. Estimated Total Expenses: The Dealer has agreed to pay for
all material expenses related to
the issuance of the Notes, except
the Issuer will pay for the London
Stock Exchange listing fees, if
applicable.
6. Codes:
(a) Common Code: 206572817
(b) ISIN: XS2065728177
7. Identity of Dealer: RBC Europe Limited
8. Provisions for Registered
Notes:
(a) Individual Definitive
Registered Notes Available
on Issue Date: No
(b) DTC Global Note(s): No
(c) Other Registered Global
Notes: Yes, issued in accordance with the
Global Agency Agreement, dated January
8, 2001, as amended, among the Bank,
Citibank, N.A., as Global Agent,
and the other parties thereto.
General Information
Additional Information Regarding the Notes
1. The language set out under the heading "Use of Proceeds" in
the Prospectus shall be deleted in its entirety and replaced by the
following:
"The net proceeds from the sale of the Notes will be included in
the ordinary capital resources of the Bank and, will not be
committed or earmarked for lending to, or financing of, any
specific loans, projects or programs. The Bank, in partnership with
its member countries, works to reduce poverty and inequalities in
Latin America and the Caribbean by promoting economic and social
development in a sustainable, climate friendly way.
The Bank's strategic priorities include social inclusion and
equality, productivity and innovation and economic integration
along with three cross-cutting issues: gender equality and
diversity, climate change and environmental sustainability, and
institutional capacity and the rule of law. Each strategic priority
of the Bank aligns to at least one of the United Nations
Sustainable Development Goals ("SDGs"), with all goals covered
within the Bank's institutional strategy, which may be adapted from
time to time should the United Nations SDGs definition evolve.
All projects undertaken by the Bank go through the Bank's
rigorous sustainability framework. The framework tracks measurable
results, adherence to lending targets and the effectiveness of its
environmental and social safeguards. The Bank's administrative and
operating expenses are currently covered entirely by the Bank's
various sources of revenue, consisting primarily of net interest
margin and investment income (as more fully described in the Bank's
Information Statement)."
2. Matters relating to UK MiFIR
The Bank does not fall under the scope of application of the UK
MiFIR regime. Consequently, the Bank does not qualify as an
"investment firm", "manufacturer" or "distributor" for the purposes
of UK MiFIR.
UK MiFIR product governance / Retail investors, professional
investors and ECPs target market - Solely for the purposes of the
UK 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 retail clients, as defined
in point (8) of Article 2 of Regulation (EU) No 2017/565 as it
forms part of UK domestic law by virtue of the EUWA, eligible
counterparties, as defined in COBS, and professional clients, as
defined in UK MiFIR; 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 UK manufacturer's target market assessment;
however, a distributor subject to the UK MiFIR Product Governance
Rules is responsible for undertaking its own target market
assessment in respect of the Notes (by either adopting or refining
the UK manufacturer's target market assessment) and determining
appropriate distribution channels.
For the purposes of this provision, (i) the expression "UK
manufacturer" means the Dealer, (ii) the expression "COBS" means
the FCA Handbook Conduct of Business Sourcebook, (iii) the
expression "UK MiFIR" means Regulation (EU) No 600/2014 as it forms
part of UK domestic law by virtue of the EUWA, and (iv) the
expression "UK MiFIR Product Governance Rules" means the FCA
Handbook Product Intervention and Product Governance
Sourcebook.
3. United States Federal Income Tax Matters
The following supplements the discussion under the "Tax Matters"
section of the Prospectus regarding the United States 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
United States federal, state, and local tax laws and non-United
States tax laws and possible changes in tax laws.
Because the Notes are denominated and payable in British pound
sterling, 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" , in
"-Purchase, Sale and Retirement of the Notes" and in "-Exchange of
Amounts in Other Than U.S. Dollars" under the "United States
Holders" section.
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 304
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 value of the 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 foreign currency
gain or loss.
Upon a sale or retirement of the Notes, 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 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 Notes. A United States holder's adjusted tax basis in
the Notes generally will equal the U.S. dollar cost of the Notes to
the United States holder, reduced, if such disposition occurs after
the first interest payment, by an amount equal to the U.S. dollar
value on the issue date of the Pre-Issuance Accrued Interest that
was previously received by the United States holder. 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 or retirement of Notes 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."
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 net 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.
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 United States 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 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 U.S.$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.
INTER-AMERICAN DEVELOPMENT BANK
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