Company Announcements

Issue of Debt

Source: RNS
RNS Number : 1919Z
Inter-American Development Bank
16 May 2019
 

 

 

PRICING SUPPLEMENT

Inter-American Development Bank

Global Debt Program

Series No.: 705

EUR 10,000,000 0.42 percent Notes due May 2, 2029

 

Issue Price: 100.00 percent

 

 

 

 

No application has been made to list the Notes on any stock exchange.

 

 

 

 

 

ING Bank N.V.

 

 

 

The date of this Pricing Supplement is April 29, 2019

 

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.

MiFID II product governance / Retail investors, professional investors and ECPs target market - See "General Information-Additional Information Regarding the Notes-Matters relating to MiFID II" 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.

Series No.:

705

 

2.

Aggregate Principal Amount:

EUR 10,000,000

 

3.

Issue Price:

EUR 10,000,000 which is 100.00 percent of the Aggregate Principal Amount

 

4.

Issue Date:

May 2, 2019

 

5.

Form of Notes
(Condition 1(a)):


Registered only, as further provided in paragraph 8 of "Other Relevant Terms" below

 

6.

Authorized Denomination(s)
(Condition 1(b)):

 

EUR 100,000 and integral multiples thereof

 

7.

Specified Currency
(Condition 1(d)):


Euro (EUR) being the lawful currency of the European Union

 

8.

Specified Principal Payment Currency
(Conditions 1(d) and 7(h)):



EUR

 

9.

Specified Interest Payment Currency
(Conditions 1(d) and 7(h)):


EUR

 

10.

Maturity Date
(Condition 6(a); Fixed Interest Rate):


May 2, 2029

 

11.

Interest Basis
(Condition 5):


Fixed Interest Rate (Condition 5(I))

 

12.

Interest Commencement Date
(Condition 5(III)):


Issue Date (May 2, 2019)

 

13.

Fixed Interest Rate (Condition 5(I)):

(a)  Interest Rate:



0.42 percent per annum

 

 

(b)  Fixed Rate Interest Payment Date(s):

Annually in arrear on May 2 in each year, commencing on May 2, 2020.

Each Interest Payment Date is subject to 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:

TARGET, New York and London

 

15.

Relevant Business Days:

TARGET, New York and London

 

16.

Issuer's Optional Redemption (Condition 6(e)):


No

 

17.

Redemption at the Option of the Noteholders (Condition 6(f)):


No

 

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 it has complied and will comply with all applicable provisions of the Financial Services and Markets Act 2000 with respect to anything done by it in relation to such Notes in, from or otherwise involving the United Kingdom.

 

 

 

(c)  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 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 Approved by the Bank and the
Global Agent and Clearance and
Settlement Procedures:

 

Euroclear Bank SA/NV and Clearstream Banking, société anonyme

 

 

3.

Syndicated:

No

4.

Commissions and Concessions:

0.09% of the Aggregate Principal Amount

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

(b)  ISIN:

198709387

 

XS1987093876

7.

Identity of Dealer:

ING Bank N.V.

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.         Matters relating to MiFID II

The Bank does not fall under the scope of application of the MiFID II regime.  Consequently, the Bank does not qualify as an "investment firm", "manufacturer" or "distributor" for the purposes of MiFID II.

MiFID II product governance / Retail investors, professional investors and ECPs target market - Solely for the purposes of the 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 eligible counterparties, professional clients and retail clients, each as defined in MiFID II; 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 manufacturer's target market assessment; however, a distributor subject to MiFID II is responsible for undertaking its own target market assessment in respect of the Notes (by either adopting or refining the manufacturer's target market assessment) and determining appropriate distribution channels.

For the purposes of this provision, the expression MiFID II means Directive 2014/65/EU, as amended.

 

2.         United States Federal Income Tax Matters

            The following supplements the discussion under the "Tax Matters" section of the Prospectus regarding the U.S. 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 U.S. federal, state, and local tax laws and non-U.S. tax laws and possible changes in tax laws.

 

            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."

 

            Because the Notes are denominated and payable in Euro, 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 scheduled Interest Payment Date will fall on a day that is not a Relevant Business Day (and that also is not a U.S. federal holiday or weekend), such that at least one of the intervals between interest payments will exceed one year.  Under current law, the status of such interest is unclear, and interest on the Notes may, as a technical matter, not be "qualified stated interest" within the meaning of the United States Treasury regulations.  It is therefore possible that the Notes could be treated as issued with original issue discount.  We intend, however, to treat interest on the Notes as issued without original issue discount for United States federal income tax reporting purposes.  If, contrary to our intended reporting position, the Notes were treated as issued with original issue discount, a United States holder of the Note would be required to include the discount in their income on an accrual basis, regardless of whether such United States holder is otherwise an accrual basis taxpayer or cash basis taxpayer.  Such interest would accrue on a yield-to-maturity basis at a rate that would not be significantly different from the stated interest rate of the Notes.

 

            Upon the sale or exchange of the Notes, a United States holder should generally recognize gain or loss equal to the difference between the U.S. dollar amount realized by such holder, excluding any amounts attributable to accrued but unpaid interest (which will be treated as interest payments), and such holder's 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 State holder.  Such gain or loss will be capital gain or loss except to the extent attributable to changes in exchange rates.  Capital gain or loss should be treated as long-term capital gain or loss to the extent the United States holder has held the Notes for more than one year.  Long-term capital gain of individual taxpayers may be eligible for reduced rates of taxation.  The deductibility of capital loss is subject to significant limitations.
 

            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 will generally include its interest income, foreign currency gain and its 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.

 

 

 

INTER-AMERICAN DEVELOPMENT BANK

By:                                                                                          

Name:    Gustavo Alberto De Rosa          

             Title:      Chief Financial Officer and

                           General Manager, Finance Department

 


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