A world first! The World Bank issued a 200 million Swiss franc digital bond in June and planned to use wCBDC to settle it

The World Bank (The World Bank) announced on May 15 that it will issue a token on the Swiss SIX Digital Exchange (SIX Digital Exchange, SDX) on June 11. A 7-year digital bond with a total price of CHF 200 million.

Settled with the Swiss Wholesale Central Bank Digital Currency wCBDC

According to the World Bank announcement, the World Bank will cooperate with the Swiss National Bank (SNB), and the digital bond will use the Swiss Wholesale Central Bank Digital Currency ( wCBDC) for settlement, making the World Bank the first international issuer to use wCBDC.

Note: Commerzbank is the sole lead manager and payment and issuance agent of the bond.

Currently, the World Bank has priced the digital bond, and as part of Project Helvetia, the Swiss National Bank is also piloting its wholesale CBDC on the SDXDLT platform. It is worth noting, however, that wCBDC must receive formal approval after the pilot, otherwise it may end up adopting tokenized Swiss francs issued by SDX.

The World Bank added that the bond is governed by Swiss law, and banks, enterprises and other entities will account for the majority of the share, accounting for 60%; followed by asset management companies, insurance companies and pension funds, accounting for 39%; The remaining shares will be deposited with central banks and official institutions.

The World Bank stated that the bond is the largest Swiss bond issued by the World Bank since 2009. Vice President Jorge Familiar also commented: We are very pleased to have the opportunity to issue the first Swiss bond as an international issuer. A Swiss franc digital bond, this achievement marks another important step in the World Bank’s commitment to working with central banks and central securities depositories to improve the efficiency of capital markets through digital technology.

UBS once issued 375 million francs of digital bonds

It is understood that in November 2022, UBS issued 375 million francs of digital bonds on SDX, which is not yet ready. Institutions that are good at adopting blockchain technology provide a precedent.

Currently, SDX has been integrated with Clearstream and Euroclear, and digital bonds issued by the World Bank can also be settled through multiple different central securities depositories.

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