The African Development Bank has raised an exceptional $3 billion in a three-year bond to help alleviate the economic and social impact the Covid-19 pandemic will have on livelihoods and Africa’s economies.  

The ‘Fight Covid-19’ Social bond, with a three-year maturity, received $4.6 billion in bids.

This is to date the largest social bond launched in international capital markets, and the largest US dollar benchmark ever issued by the bank.

It will pay an interest rate of 0.75% and has been allocated to central banks and official institutions, the multilateral lender said in a statement on Friday.

The African Development Bank Group is moving to provide flexible responses aimed at lessening the severe economic and social impact of this pandemic on its regional member countries and Africa’s private sector.

“These are critical times for Africa as it addresses the challenges resulting from the Coronavirus. The African Development Bank is taking bold measures to support African countries. This $3 billion Covid-19 bond issuance is the first part of our comprehensive response that will soon be announced. We are here for Africa, and we will provide significant rapid support for countries,” said Dr. Akinwumi Adesina, President of the African Development Bank Group.

So far the virus has seen the confirmation of more than 3,000 infections across the continent.

Coronavirus cases were slow to arrive in Africa, but the virus is spreading quickly, placing further strain on a already fragile health systems. 

It’s estimated that the continent will require billions of dollars to cushion the impact of the disease as many countries scrambled for effective measures, including commercial lockdowns in efforts to contain the spread of the virus.  

Commenting on the landmark transaction, George Sager, Executive Director, SSA Syndicate, Goldman Sachs said: “In a time of unprecedented market volatility, the African Development Bank has been able to brave the capital markets in order to secure invaluable funding to help the efforts of the African continent’s fight against Covid-19. Not only that, but in the process, delivering their largest ever USD benchmark. A truly remarkable outcome both in terms of its purpose but also in terms of a USD financing”.