Borrowing Strategy and Debt Programs
AIIB’s funding strategy is to optimize borrowing costs at all times. Issuance will be via a combination of USD benchmarks, alongside Eurobonds and private placements in various markets. Investor marketing initiatives are conducted on an on-going basis, to develop and maintain a committed base of stakeholders for primary and secondary market activities. Our aim is to build a diversified borrowing program in terms of product, tenor and currency, and thereby develop a global investor base. The core objective is to be viewed as a flexible, transparent and responsive issuer, providing liquid public offerings and reverse-inquiry, tailor-made investment solutions.
When AIIB enters the capital markets, its initial annual borrowing program is expected to be several USD billions per annum during the first years of capital markets issuance. The strategy will be to issue a US dollar benchmark offering, subject to market conditions, which will then be complemented by public and/or private issues to maintain a diversified portfolio of currencies and maturities, thus responding to the needs of a developing global investor base. Risk management strategies will overlay funding operations to minimize exposure to currency and interest rate risks.
AIIB has established a STEP compliant Euro commercial paper program rated A-1+ by S&P Global Ratings and Prime-1 by Moody’s Investors Service.