CORONAVIRUS - 2020

[DarthYoda]

World Bank Pandemic Bonds:

Two bonds worth a total of $320 million: Dubbed Class A and the riskier Class B.
Interest payments: Class A dishes out interest payments of 6.5% plus 6-month U.S. dollar Libor rate. Class B pays out 11.10% plus 6-month U.S. dollar Libor rate. These interest payments are funded by donor countries including Japan and Germany.
Viruses covered: The six that are “most likely to cause a pandemic,” the World Bank said, which could trigger a payout to countries — Influenza, coronaviruses, Filovirus, Lassa Fever, Rift Valley Fever and Crimean Congo Hemorrhagic Fever.
Countries that could receive that payout: 76 countries are eligible for funding under the World Bank’s International Development Association.
If that payout is triggered, that’s when investors stand to lose their money. For investors of Class A notes, that loss is 16.67% of their principal amount, while those invested in Class B notes stand to lose everything.
Investors in those bonds reportedly include French asset management firm Amundi, and U.K.-based asset manager Baillie Gifford. According to DBRS Morningstar, the bonds are owned by asset managers, pension funds, among others. Investors are mostly based in the U.S. and Europe.
The bonds were more than 200% oversubscribed in 2007 when they were issued.

https://www.cnbc.com/2020/03/18/coronavirus-world-bank-pandemic-bond-investors-face-big-losses.html