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Treasury & Capital Markets
IIX closes second multi-country gender bond in Asia-Pacific
US$12 million WLB2 is second in debt securities series that helps create sustainable livelihoods for women in Asia
The Asset 16 Jan 2020

Impact Investment Exchange (IIX) has successfully closed the US$12 million Women’s Livelihood Bond 2 (WLB2), the second multi-country gender bond in the Asia-Pacific to be listed on a stock exchange, the Singapore Exchange (SGX), creating sustainable livelihoods for over 250,000 underserved women in the region.

The WLB2, announced on January 15, is the second bond in the award-winning Women’s Livelihood Bond Series (WLB Series), which has gained new support from the Rockefeller Foundation, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), United Nations Capital Development Fund (UNCDF), Standard Chartered, Latham & Watkins, Cyril Amarchand Mangaldas, and UN Women.

These partners join existing supporters including the United States Agency for International Development (USAID), the Australian Department of Foreign Affairs and Trade (DFAT), DBS, ANZ, Shearman & Sterling, Hogan Lovells, and more.

The success of the WLB2 adds to the long-standing partnership with USAID, which played a significant role in the success of the first Women’s Livelihood Bond (WLB1). USAID’s continued engagement further demonstrates the US Government’s support for the Association of Southeast Asian Nations (Asean) and the Indo-Pacific region.

Investors in the bonds include US institutional investor Nuveen, European institutional investor Blue Orchard, and others from across Asia, Australia and New Zealand.

The US$150+ million WLB Series are debt securities that will create sustainable livelihoods for over two million women across Asia through innovative finance. The WLB Series are the first listed gender lens bonds for several countries in Asia including Indonesia, India, Sri Lanka and Cambodia.

The WLB Series’ key innovations include: (1) being the world’s first gender lens instrument listed on a stock exchange; (2) creating a deep impact investment product suitable for institutions and private banking clients; and (3) demonstrating scalability and replicability across geographies and sectors.

Private investors in the WLB Series will benefit from first loss capital provided by the Rockefeller Foundation and a 50% loan portfolio guarantee provided by USAID. DFAT has provided a catalytic upfront grant required to develop the WLB2. ESCAP and UNCDF, with financial support provided by the Government of Canada through Global Affairs Canada, are providing additional funding to scale-up the WLB Series.

UN under-secretary-general and ESCAP executive secretary Armida Salsiah Alisjahbana states, “2020 will be a critical milestone in accelerating progress for women’s economic empowerment across the Asia-Pacific region. We are proud to announce our partnership with IIX’s Women’s Livelihood Bond Series, which embodies the bold innovations that are needed to advance progress for the world’s poorest communities.”

Gloria Steele, acting assistant administrator of USAID’s bureau for Asia, expressed her strong support for the announcement, stating, “The Women’s Livelihood Bond Series represents the nexus of collaboration between the private sector and public organizations to realize a shared vision of inclusive growth and women’s empowerment. I am pleased to see the expansion of our partnership with so many new organizations joining to increase economic opportunities for women across the region because we believe that sustainable partnerships are critical to the journey to self-reliance and to achieving the prosperity that all nations seek.”

The managing director of innovative finance at the Rockefeller Foundation, Lorenzo Bernasconi, says, “As one of the first supporters of Impact Investment Exchange, we are excited to participate in the second Women’s Livelihood Bond. The Women’s Livelihood Bond Series is a prime example of catalytic capital at work – where risk-tolerant, impact-prioritizing funding is leveraged to unlock private sector capital. In this case, Rockefeller’s investment is expected to be amplified at least ten times by private investors, bringing critical funding to women-focused enterprises in Southeast Asia.”

Stephen Liberatore, portfolio manager and head of public markets ESG/impact fixed income investment team at Nuveen, says the innovative transaction will provide financing to women, a perpetually underserved market globally. “The attractive relative valuation and scalability potential for this structure, along with the direct and measurable results of the proceeds, make this a natural fit for our public markets impact bond strategies. In addition to the commendable focus of this deal and its financial returns, we were particularly pleased with the issuer’s commitment to providing impressively detailed impact reporting on an ongoing basis. This is a critical element of any deal we participate in because of the comprehensive annual impact report we provide to our clients.”

IIX’s CEO and founder, Durreen Shahnaz, says, “IIX’s Women’s Livelihood Bond Series is setting the stage for a new gender-empowered financial system where women are truly valued and given a voice. Starting with the Asia-Pacific, we are building an entire ecosystem for gender lens investing by bringing together governments, businesses, multilateral and philanthropic organizations, and most importantly, investors, for women’s empowerment. Having demonstrated the success of this innovative financial product, we will be launching a series of bonds across new sectors and markets in the coming years.”

In 2017, IIX launched the first of the WLB Series, the Women’s Livelihood Bond 1 (WLB1) – which is the world’s first impact investing instrument to be listed on a stock exchange and Asia’s first multi-country listed gender bond, reporting both social and financial returns. Listed on the SGX and quoted on Bloomberg, the WLB1 is also the world’s first listed financial product that is focused on women’s livelihoods.

Demonstrating the scalability and replicability of the WLB Series, IIX will be launching the third Women’s Livelihood Bond (WLB3) in 2020, and will build on the success of the WLB1 and WLB2 by expanding to include more countries and new sectors. The WLB2 is the first ICMA and Asean Capital Markets-certified social bond focused on women’s empowerment.

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