The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) has announced a CHF Digital bond. The bond will settled using the Swiss Franc through a distributed ledger technology.
The digital bond will be the first CHF digital bond issued by an international issuer with settlements in Swiss Francs wholesale CBDC (wCBDC). The CDBC will be offered by the Swiss National Bank (SNB). The digital bond has a 7-year tenure worth CHF 200 million, about $219 million. It represents the largest-ever CHF bond issuance since 2009.
Also Read: Bank Debuts First Digital Native Note (DNN) on Luxembourg Stock Exchange
World Bank Partners With Swiss National Bank and SIX Digital Exchange
We are proud to announce that The @WorldBank has issued a #digitalbond on #SDX as its first international issuer. The bond will settle using Swiss Franc #wCBDC provided by the @SNB_BNS. The #bond is listed on both the #SIXdigitalexchange and the SIX Swiss Exchange. @commerzbank… pic.twitter.com/TZ0fQe442q
— SIX Digital Exchange (@SDX_global) May 16, 2024
The bank has established relationships with SNB and SIX Digital Exchange (SDX). The collaboration will provide top-notch services in capital markets using distributed ledger technology (DLT). The partnership will enhance the use of DLT by accepting coupon redemption payments in tokenized CHF. The payments will be made through SDX, configured to connect to existing financial systems.
Vice President and Treasurer of World Bank Commented on the Progress
Leaders championing this revolution commented on the partnerships between the three entities. Starting with Jorge Familiar, Vice President and Treasurer of the World Bank.
“We are grateful for the opportunity to issue the first CHF digital bond as an international issuer. This achievement marks another significant step in the World Bank’s commitment to increasing capital markets’ efficiency through digitalization in partnership with central banks and central securities depositories. It builds on our previous accomplishments with bond-i and the issuance of digitally native notes last October.”
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Head of SIX Digital Exchange, David Newns, doubled down on the importance of tokenized central bank money. He said adopting wholesale transaction settlements is critical for blockchain adoption within capital markets infrastructure.
Marie-Claire Ouziel, Global Head of Bonds, Commerzbank, closed by saying,
“Many congratulations to the World Bank team on today’s CHF outing, breaking a multiyear absence from this market. This digital bond issuance marks another triumph for the World Bank, cementing its position as an avant-garde issuer embracing innovative technologies. The World Bank demonstrated its global investor appeal while transforming the way in which debt capital markets move forward. I am proud of the partnership among World Bank, SNB, SDX and Commerzbank that lead to this groundbreaking success.”
World Bank to Advance Digitization in Capital Markets
The World Bank is well-sold on using distributed ledgers to improve efficiency in the capital markets. Its commitment is evidenced by its recent partnerships with DLT infrastructure providers. Considering that it issued a digital bond on Euroclear’s Digital Financial Market Infrastructure last year, it’s clear that it is determined to include DLT in the international financial system.
Cryptopolitan reporting by Collins J. Okoth
