TIDM42BI
RNS Number : 9798S
Inter-American Development Bank
28 June 2018
PRICING SUPPLEMENT
Inter-American Development Bank
Global Debt Program
Series No.: 651
IDR 44,100,000,000 6.22 percent Notes due July 13, 2023 (the
"Notes")
payable in Japanese Yen
Issue Price: 100.00 percent
No application has been made to list the Notes on any stock
exchange.
Tokai Tokyo Securities Europe Limited
The date of this Pricing Supplement is as of June 25, 2018.
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 Directive
2003/71/EC of the European Parliament and of the Council). 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.
Terms and Conditions
The following items under this heading "Terms and Conditions"
(as supplemented by the attached "Annex to Pricing Supplement, IDB
Series No. 651") 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. Series No.: 651
2. Aggregate Principal Amount: IDR 44,100,000,000
3. Issue Price: 100.00 percent of the Aggregate Principal
Amount
The Issue Price will be payable in
Japanese Yen ("JPY"), being the lawful
currency of Japan, in the amount
of JPY 346,052,700 based on the agreed
rate of JPY 0.007847 per one IDR.
4. Issue Date: June 28, 2018
5. Form of Notes Bearer only. The Notes will initially
(Condition 1(a)): be represented by a temporary global
note in bearer form (the "Temporary
Bearer Global Note"). Interests in
the Temporary Bearer Global Note
will, not earlier than the Exchange
Date, be exchangeable for interests
in a permanent global note in bearer
form (the "Permanent Bearer Global
Note"). Interests in the Permanent
Bearer Global Note will be exchangeable
for definitive notes in bearer form
("Definitive Bearer Notes"), with
all Coupons in respect of interest
attached, in the following circumstances:
(i) if the Permanent Bearer Global
Note is held on behalf of a clearing
system and such clearing system is
closed for business for a continuous
period of fourteen (14) days (other
than by reason of holidays, statutory
or otherwise) or announces its intention
to permanently cease business or
does in fact do so, by any such holder
giving written notice to the Global
Agent; and (ii) at the option of
any such holder upon not less than
sixty (60) days written notice to
the Bank and the Global Agent from
Euroclear and Clearstream, Luxembourg
on behalf of such holder; provided
that no such exchanges will be made
by the Global Agent, and no Noteholder
may require such an exchange, during
a period of fifteen (15) days ending
on the due date for any payment of
principal on the Notes.
6. Authorized Denomination(s) IDR 50,000,000
(Condition 1(b)):
7. Specified Currency Indonesian Rupiah ("IDR") being the
(Condition 1(d)): lawful currency of the Republic of
Indonesia; provided that all payments
in respect of the Notes will be made
in JPY.
8. Specified Principal Payment JPY
Currency
(Conditions 1(d) and 7(h)):
9. Specified Interest Payment JPY
Currency
(Conditions 1(d) and 7(h)):
10. Maturity Date July 13, 2023
(Condition 6(a); Fixed The Maturity Date is subject to adjustment
Interest Rate): in accordance with the Modified Following
Business Day Convention with no adjustment
to the amount of interest otherwise
calculated.
11. Interest Basis Fixed Interest Rate (Condition 5(I))
(Condition 5):
12. Interest Commencement Date June 29, 2018
(Condition 5(III)):
13. Fixed Interest Rate (Condition
5(I)): 6.22 percent per annum
(a) Interest Rate:
(b) Fixed Rate Interest Semi-annually in arrears on January
Payment Date(s): 13 and July 13 of each year, commencing
on January 13, 2019 and ending on
the Maturity Date.
Each Fixed Rate Interest Payment
Date is subject to adjustment in
accordance with the Modified Following
Business Day Convention with no adjustment
to the amount of interest otherwise
calculated.
The Interest Amount with respect
to the Interest Period from and including
the Interest Commencement Date to
but excluding January 13, 2019, shall
be a JPY amount calculated on the
relevant IDR Valuation Date as follows:
IDR 1,675,944 multiplied by IDR Rate
(rounding, if necessary, the entire
resulting figure to the nearest whole
JPY, with
JPY 0.5 being rounded upwards)
The Interest Amount with respect
to each subsequent Interest Period
shall be a JPY amount calculated
on the relevant IDR Valuation Date
as follows:
IDR 1,555,000 multiplied by IDR Rate
(rounding, if necessary, the entire
resulting figure to the nearest whole
JPY, with
JPY 0.5 being rounded upwards)
(c) Fixed Rate Day Count
Fraction(s): 30/360
14. Relevant Financial Center: Tokyo
15. Relevant Business Day: Tokyo, London, New York City, Singapore
and Jakarta
16. Redemption Amount (Condition An amount in JPY per Authorized Denomination,
6(a)): calculated as follows on the IDR
Valuation Date for the Maturity Date:
IDR 50,000,000 multiplied by IDR
Rate
(rounding, if necessary, the entire
resulting figure to the nearest whole
JPY, with
JPY 0.5 being rounded upwards)
17. Issuer's Optional Redemption No
(Condition 6(e)):
18. Redemption at the Option No
of the Noteholders (Condition
6(f)):
19. Early Redemption Amount In the event of any Notes becoming
(including accrued interest, due and payable prior to the Maturity
if applicable) (Condition Date in accordance with Condition
9): 9, the Early Redemption Amount of
each such Note shall be a JPY amount
equal to the Redemption Amount that
is determined in accordance with
"16. Redemption Amount (Condition
6(a))" plus accrued and unpaid interest,
if any, as determined in accordance
with "13. Fixed Interest Rate (Condition
5(I))"; provided that, for the purpose
of determining such JPY amount, the
IDR Valuation Date shall mean the
date that is five (5) Relevant Business
Days prior to the date on which the
Early Redemption Amount shall be
due and payable as provided in Condition
9.
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.
Notes in bearer form are subject
to U.S. tax law requirements and
may not be offered, sold or delivered
within the United States or its possessions
or to U.S. persons, except in certain
transactions permitted by U.S. tax
regulations.
(b) United Kingdom:
The Dealer has agreed that it has
complied and will comply with all
applicable provisions of the Financial
Services and Markets Act of 2000
with respect to anything done by
it in relation to the Notes in, from
or otherwise involving the United
Kingdom.
(c) Republic of 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. As such,
the Dealer has represented and agreed
that (i) it has not offered or sold
and will not offer or sell any Notes
in the Republic of Indonesia or to
Indonesian nationals, corporates
or residents including by way of
invitation, offering or advertisement,
and (ii) has not distributed, and
will not distribute, the Prospectus,
this Pricing Supplement, or any other
offering material relating to the
Notes in the Republic of Indonesia,
or to Indonesian nationals, corporates
or residents, in a manner which constitutes
a public offering of the Notes under
the laws and regulations of the Republic
of Indonesia.
(d) Japan:
The Dealer acknowledges that a secondary
distribution (Uridashi) of the Notes
is scheduled to be made in Japan
and represents that it is purchasing
the Notes as principal and has agreed
that in connection with the initial
offering of Notes, it has not offered
or sold and will not directly or
indirectly offer or sell any Notes
in Japan or to, or for the benefit
of, any resident of Japan (including
any Japanese corporation or any other
entity organized under the laws of
Japan), or to others for re-offering
or resale, directly or indirectly,
in Japan or to, or for the benefit
of, any resident of Japan (except
in compliance with the Financial
Instruments and Exchange Law of Japan
(Law no. 25 of 1948, as amended)
and all other applicable laws and
regulations of Japan), and furthermore
undertakes that any securities dealer
to whom it sells any Notes will agree
that it is purchasing the Notes as
principal and that it will not offer
or sell any Notes, directly or indirectly,
in Japan or to or for the benefit
of any resident of Japan (except
as aforesaid).
(e) General
No action has been or will be taken
by the Bank 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.
22. 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")."
23. 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 Global Agent under
the
Bank's Global Debt Program - namely,
Citibank, N.A., London Branch, or
its duly
authorized successor.
Other Relevant Terms
1. Listing: None
2. Details of Clearance System Euroclear Bank S.A./N.V. and/or Clearstream,
Approved by the Bank and Luxembourg
the
Global Agent and Clearance
and
Settlement Procedures:
3. Syndicated: No
4. Commissions and Concessions: No commissions or concessions are
payable in respect of the Notes.
The Dealer or one of its affiliates
has arranged a swap with the Bank
in connection with this transaction
and will receive amounts thereunder
that may comprise compensation.
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: 182540676
(b) ISIN: XS1825406769
7. Identity of Dealer: Tokai Tokyo Securities Europe Limited
8. Identity of Calculation JPMorgan Chase Bank, N.A.
Agent: 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 commercially
reasonable manner in accordance with
the calculation agent agreement between
the Bank and the Calculation Agent.
9. Provisions for Bearer Notes:
(a) Exchange Date: Not earlier than 40 (forty) days
after the Issue Date.
(b) Permanent Global Note: Yes
(c) Definitive Bearer Notes: No, except in the circumstances described
under "Form of Notes" herein and
in the Prospectus.
(d) Individual Definitive No
Registered Notes:
(e) Registered Global Notes: No
10. Additional Risk Factors: As set forth in the Additional Investment
Considerations.
General Information
IDB Statement on Venezuela
On May 14, Venezuela passed the Bank's 180-day limit for payment
arrears for an amount of $88.3 million, placing the country in a
non-accrual status.
Venezuela's total loan arrears, including those that have not
yet reached the 180-day limit, stand at $212.4 million on a total
debt of $2.011 billion. Venezuela's debt to the IDB represents 1.6%
of the Bank's total assets as of March 31, 2018.
Under the IDB's guidelines on arrears, the Bank cannot undertake
any lending activities concerning Venezuela until its arrears are
cleared. As a matter of policy, the Bank does not reschedule its
sovereign-guaranteed loans.
The IDB does not expect Venezuela's non-accrual event to affect
the Bank's 2018 liquidity and capital ratios, which remain strong
and in full compliance with its financial policies. The IDB
anticipates that the event will not affect its 2018 lending
program.
Venezuela, which became a shareholder of the IDB when the
institution was founded in 1959, has reiterated its commitment to
the IDB and its intention to undertake regular payments. The IDB
acknowledges Venezuela's efforts and will continue to work with its
government to resolve the arrears.
Additional Information Regarding the Notes
1. Additional Investment Considerations:
There are significant risks associated with the Notes, including
but not limited to exchange rate risk, price risk and liquidity
risk. Investors should consult their own financial, legal,
accounting and tax 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.
The methodologies for determining the Japanese Yen- Indonesian
Rupiah foreign exchange rate may result in a Redemption Amount of
the Notes, or an interest payment on the Notes, being significantly
less than anticipated.
The Bank may hedge its obligations under the Notes by entering
into a swap transaction with the Dealer or one of its affiliates as
swap counterparty. Assuming no change in market conditions or any
other relevant factors, the price, if any, at which the Dealer or
another purchaser might be willing to purchase Notes in a secondary
market transaction is expected to be lower, and could be
substantially lower, than the original issue price of the Notes.
This is due to a number of factors, including that (i) the
potential profit to the secondary market purchaser of the Notes may
be incorporated into any offered price and (ii) the cost of funding
used to value the Notes in the secondary market is expected to be
higher than our actual cost of funding incurred in connection with
the issuance of the Notes. In addition, the original issue price of
the Notes included, and secondary market prices are likely to
exclude, the projected profit that our swap counterparty or its
affiliates may realize in connection with this swap. Further, as a
result of dealer discounts, mark-ups or other transaction costs,
any of which may be significant, the original issue price may
differ from values determined by pricing models used by our swap
counterparty or other potential purchasers of the Notes in
secondary market transactions.
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.
INTER-AMERICAN DEVELOPMENT BANK
By:
Name: Gustavo Alberto De Rosa
Title: Chief Financial Officer
and General Manager, Finance Department
Annex to Pricing Supplement, IDB Series No. 651
Other Applicable Definitions
"IDR Business Day" means a day on which commercial banks and
foreign exchange markets settle payments in Tokyo, New York City,
London, Singapore and Jakarta.
"IDR Rate" means, in respect of an IDR Valuation Date, the
IDR/JPY exchange rate, expressed as the amount of JPY per one IDR,
which is calculated by the Calculation Agent in accordance with the
following formula and rounded to the nearest six decimal places
with 0.0000005 being rounded up:
USD/JPY Reference Rate divided by USD/IDR Reference Rate
"IDR Valuation Date" for a Fixed Rate Interest Payment Date or
the Maturity Date means the date that is five (5) Relevant Business
Days prior to such Fixed Rate Interest Payment Date or the Maturity
Date, as applicable.
"Jakarta Business Day" means a day (other than a Saturday or a
Sunday) on which commercial banks and foreign exchange markets are
open for business and settle payments in Jakarta.
"Reference Dealers" means major banks active in the USD/IDR or
USD/JPY currency and foreign exchange markets, as applicable.
"USD" means United States dollars.
"USD/IDR Reference Rate" means the spot rate of USD/IDR
expressed as the number of IDR per one USD, for settlement in two
Jakarta Business Days, published on the Thomson Reuters Screen
"JISDOR" page (or such other page or service as may replace any
such page for the purposes of displaying the USD/IDR foreign
exchange rate) at approximately 10:00 a.m. Jakarta time on the
applicable IDR Valuation Date, as determined by the Calculation
Agent.
In the event that no such quotation appears on the Thomson
Reuters Screen "JISDOR" page (or its successor page for the purpose
of displaying such rate), the USD/IDR Reference Rate shall be
determined by the Calculation Agent by requesting quotations for
mid rate of USD/IDR foreign exchange rate at or about 11:00 a.m.
Singapore time on the first (1st) IDR Business Day following the
relevant IDR Valuation Date from the Reference Dealers.
If five or four quotations are provided as requested, the
USD/IDR Reference Rate will be the arithmetic mean (rounded to the
nearest whole IDR, 0.5 being rounded upwards) of the remaining
three or two such quotations, as the case may be, for such rate
provided by the Reference Dealers, after disregarding the highest
such quotation and the lowest such quotation (provided that, if two
or more such quotations are the highest such quotations, then only
one of such quotations shall be disregarded, and if two or more
such quotations are the lowest quotations, then only one of such
lowest quotations will be disregarded).
If only three or two such quotations are provided as requested,
the USD/IDR Reference Rate shall be determined as described above
except that the highest and lowest quotations will not be
disregarded.
If none or only one of the Reference Dealers provides such
quotation, the USD/IDR Reference Rate will be determined by the
Calculation Agent in its sole discretion, acting in good faith and
in a commercially reasonable manner, having taken into account
relevant market practice, by reference to such additional sources
as it deems appropriate.
"USD/JPY Reference Rate" means the bid rate of USD/JPY,
expressed as the number of JPY per one USD, published on the
Thomson Reuters Screen "JPNU" page (or its successor page for the
purpose of displaying such rate) as of 12:00 p.m., Tokyo time on
the applicable IDR Valuation Date, as determined by the Calculation
Agent.
In the event that no such quotation appears on the Thomson
Reuters Screen "JPNU" page (or its successor page for the purpose
of displaying such rate), the USD/JPY Reference Rate shall be
determined by the Calculation Agent by requesting quotations for
bid rate of USD/JPY foreign exchange rate at or about 12:00 p.m.
Tokyo time on the first (1st) IDR Business Day following the
relevant IDR Valuation Date from the Reference Dealers.
If five or four quotations are provided as requested, the
USD/JPY Reference Rate will be the arithmetic mean of the remaining
three or two such quotations, as the case may be, for such rate
provided by the Reference Dealers, after disregarding the highest
such quotation and the lowest such quotation (provided that, if two
or more such quotations are the highest such quotations, then only
one of such quotations shall be disregarded, and if two or more
such quotations are the lowest quotations, then only one of such
lowest quotations will be disregarded).
If only three or two such quotations are provided as requested,
the USD/JPY Reference Rate shall be determined as described above
except that the highest and lowest quotations will not be
disregarded.
If none or only one of the Reference Dealers provides such
quotation, the USD/JPY Reference Rate will be determined by the
Calculation Agent in its sole discretion, acting in good faith and
in a commercially reasonable manner, having taken into account
relevant market practice, by reference to such additional sources
as it deems appropriate.
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
IODUWRWRWOANUAR
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