Euroclear has announced a major milestone with the Asian Infrastructure Investment Bank (AIIB) issuing its first digitally native note.
According to Finextra, this historic issuance, executed on Euroclear’s Digital Financial Market Infrastructure (D-FMI), marks a series of firsts: it’s the first digital issuance in USD on Euroclear’s platform and the first by an Asia-based issuer. The $300m raised will bolster AIIB’s sustainable development bond programme.
The DNN was issued via Euroclear’s Digital Securities Issuance (D-SI) service, leveraging distributed ledger technology (DLT) for the issuance, distribution, and settlement of fully digital international securities. Notably, the note is triple-A rated by Moody’s, Standard and Poor’s, and Fitch Ratings and is listed on the Luxembourg Stock Exchange. The issuance involved key financial partners including Citi, acting as both dealer and issuing and paying agent, BMO Capital Markets as a dealer, and Euroclear Bank as the issuer central securities depository. The clearing of these bonds is facilitated on platforms like the Hong Kong Monetary Authority’s Central Moneymarkets Unit (CMU) and SIX Swiss Exchange (SIX).
Philippe Laurensy, Managing Director and Head of Product, Strategy and Innovation at Euroclear, remarked on the significance of this digital step: “As we continue our journey to becoming a digital, data-enabled Financial Market Infrastructure, this issuance signifies another important step forward. Together with our clients and the wider ecosystem, we will continue to embrace innovation and deliver robust technology solutions that can unlock new business opportunities and attract issuers and investors from across the globe.”
AIIB Treasurer, Domenico Nardelli, highlighted the unique aspects of this transaction: “AIIB is proud to partner with Euroclear, Citi and BMO on this milestone transaction of many firsts. Not only is this the first USD digitally native note in Euroclear’s D-FMI, it is also the first time an issuer based in Asia has issued on the platform and the first time a DNN could be held in CMU or SIX,” he said. “The success of this transaction proves Euroclear’s D-FMI allows for easy and broad adoption of digital bonds at scale where market participants can buy and sell the bonds within their existing account structures. As a multilateral development bank financing Infrastructure for Tomorrow and with innovation in its DNA, AIIB sees this as an important opportunity to participate in the digitization of capital markets and help connect Asia and the world.”
Richard Zogheb, Head of Global Debt Capital Markets at Citi, and Summer Hinton, Head of Global Markets International at BMO Capital Markets, also shared their insights on the impact of digitalization in the financial markets and their ongoing commitment to supporting innovative financial solutions.
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