July 6, 2017— SINGAPORE— IIX (Impact Investment Exchange), a pioneer in impact investing and catalyst to social innovation, has closed the world’s first social sustainability bond to be listed on a stock exchange, the Women’s Livelihood Bond (WLB)™. This innovative US$8 million bond is the first in a series of IIX Social Sustainability Bonds™ and is projected to empower over 385,000 women across Southeast Asia through increased credit access, market linkages, and affordable goods and services.
The WLB™, conceptualized and structured by IIX, is supported by a diverse range of stakeholders from the public, private, and philanthropic sector including DBS Bank Ltd, ANZ Banking Group, the Rockefeller Foundation, the Clinton Global Initiative, U.S Agency for International Development’s (USAID), the Australian Department of Foreign Affairs and Trade (DFAT), Shearman & Sterling, Hogan Lovells, and the Japan Research Institute, among others. The bond aims to support a select group of high-impact enterprises and microfinance institutions in Cambodia, Vietnam, and the Philippines.
“The closing of the Women’s Livelihood Bond™ is a landmark achievement for the impact investment market, demonstrating that impact investment products can achieve scale, transparency and liquidity,” said IIX’s Founder, Durreen Shahnaz, “The infrastructure for social capital markets is now taking off. This transaction brings us one step closer to a day when our financial markets consider social and environmental impact on an equal footing with financial returns and we can at last aim to have an equitable and truly connected financial market.”
The four-year bond offers a coupon rate of 5.65% per annum and is expected to be listed on the Singapore Exchange (SGX). The bond includes a number of credit protection features, including $500,000 of first-loss capital provided by IIX as well as a 50% guarantee of the principal amount of the underlying loan portfolio, provided by USAID. The bond received over 60% of its investment capital from Asian investors.
Tan Su Shan, Group Head of Consumer Banking/Wealth Management at DBS Bank added: “We would like to acknowledge the support of our clients, who helped to make the WLB™ a reality. With Asia’s entrenched culture of giving, we see tremendous potential in the business of impact investing in this region. Singapore is well-placed to become a regional hub for impact investing, leveraging the infrastructure and eco-system it has built as a leading hub for tech start-ups and tapping on the region’s unique intersection of wealth and socio-environmental needs. This is a modest but important first step and we will continue to work closely with partners like IIX to bring innovative financial instruments to investors in Asia who are seeking to combine social and financial returns.”
A recognized leader in impact investing space, IIX has also established the world’s first social stock exchange as well as Asia’s largest impact investing equity crowdfunding platform. IIX intends to replicate the WLB™ across the globe and expects that future IIX Social Sustainability Bonds™ will be listed on IIX’s Impact Exchange.
About IIX Social Sustainability Bonds™
IIX Social Sustainability Bonds™ are uniquely structured fixed-income financial instruments which pool together a group of high-impact enterprises and issues a collective bond. These bonds differ from traditional Social Impact Bonds as they mobilize private sector capital to generate positive social impact worldwide, offer financial returns independent of social outcomes, and are able to be listed on both social and traditional stock exchanges.
IIX is a Singapore-based impact enterprise that bridges the gap between finance and development, carving out a third space for social and environmental solutions by unlocking investment capital. As a pioneer of impact investing, IIX builds pathways to connect the Wall Streets of the world with the backstreets of underserved communities. IIX platforms and innovative financial products enable impact enterprises to accelerate their business and scale their positive impact, while pushing the impact investing space from the margins to the mainstream. To date, the work of IIX has spanned 20 countries and continues to expand with the mission of unlocking US$1billion of impact investment capital, impacting 100 million lives by 2025.
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Photo Attribution: Photo by Leocadio Sebastian/CC BY