Citi Supports the Issuance of the Asian Infrastructure Investment Bank’s First digitally native note

Citi served as dealer as well as issuing and paying agent on the issuance of the Asian Infrastructure Investment Bank (AIIB)'s first digitally native note (DNN). The issuance was done on Euroclear’s Digital Financial Market Infrastructure (D-FMI) and is the first digital issuance in USD on the platform. It is also the first such issuance by an Asia-based issuer on the platform. The transaction was also supported by BMO Capital Markets as a dealer.

The digitally native note, boasting a triple-A rating by Moody’s, Standard and Poor’s and Fitch Ratings, successfully raised USD $300 million to support AIIB’s sustainable development bond programme.

The issuance was done via Euroclear’s Digital Securities Issuance (D-SI) service, which enables the issuance, distribution and settlement of fully digital international securities on distributed ledger technology (DLT). The note is listed on the Luxembourg Stock Exchange. Citi acted as a dealer as well as issuing and paying agent, BMO Capital Markets as a dealer, and Euroclear Bank as the issuer central securities depository. Clearing of the bonds is also possible on the Hong Kong Monetary Authority’s Central Moneymarkets Unit (CMU) and SIX Swiss Exchange (SIX).

This digitally native note issuance further demonstrates the capabilities of Euroclear's digital securities issuance service to support market adoption of digital assets. With the objective to provide investors with sufficient liquidity tools and complete access to trading venues, Euroclear fully integrated the D-FMI platform with its traditional settlement system, ensuring CSDR compliance. Euroclear’s D-SI service, launched in 2023, was recently recognised by Global Custodian magazine with the Market Infrastructure Project of the Year award.

Philippe Laurensy, Managing Director and Head of Product, Strategy and Innovation at Euroclear commented: “As we continue our journey to becoming a digital, data-enabled Financial Market Infrastructure, this issuance signifies another important step forward. Together with our clients and the wider ecosystem, we will continue to embrace innovation and deliver robust technology solutions that can unlock new business opportunities and attract issuers and investors from across the globe.”

“AIIB is proud to partner with Euroclear, Citi and BMO on this milestone transaction of many firsts. Not only is this the first USD digitally native note in Euroclear’s D-FMI, it is also the first time an issuer based in Asia has issued on the platform and the first time a DNN could be held in CMU or SIX,” said AIIB Treasurer, Domenico Nardelli. “The success of this transaction proves Euroclear’s D-FMI allows for easy and broad adoption of digital bonds at scale where market participants can buy and sell the bonds within their existing account structures. As a multilateral development bank financing Infrastructure for Tomorrow and with innovation in its DNA, AIIB sees this as an important opportunity to participate in the digitization of capital markets and help connect Asia and the world.”

Citi has supported AIIB on previous transactions and this marks the first time that Citi has worked with AIIB on the issuance of a digitally native note. Citi will continue to facilitate the issuance of digital bonds, unlocking the potential of digital assets for clients including efficient access to capital while paving the way for new operational models.

“This digitally native note issuance reflects the growing adoption of digital assets in financial markets. Citi is proud to be a key participant on this important benchmark. From execution and settlement to our work as issuing and paying agent, Citi’s roles leverage the power of the bank’s interconnected businesses to support clients through the full lifecycle of key transactions,” said Richard Zogheb, Head of Global Debt Capital Markets at Citi.

“BMO Capital Markets was delighted to be involved in this milestone transaction for AIIB, in partnership with Citi and Euroclear. Digitalization is high on banks’, issuers’ and investors’ agendas as the financial industry strives to increase efficiency and resilience,” said Summer Hinton, Head of Global Markets International. “Here at BMO, digital is how we operate and we are pleased to see Debt Capital Markets continue to evolve in innovative ways which will be scalable in the future.”

About Citi
Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in more than 180 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.

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About AIIB

The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank whose mission is Financing Infrastructure for Tomorrow in Asia and beyond—infrastructure with sustainability at its core. We began operations in Beijing in 2016 and have since grown to 109 approved members worldwide. We are capitalized at USD100 billion and AAA-rated by the major international credit rating agencies. Collaborating with partners, AIIB meets clients’ needs by unlocking new capital and investing in infrastructure that is green, technology-enabled and promotes regional connectivity.

About Euroclear

Euroclear group is the financial industry’s trusted provider of post trade services. Guided by its purpose, Euroclear innovates to bring safety, efficiency and connections to financial markets for sustainable economic growth. Euroclear provides settlement and custody of domestic and cross-

border securities for bonds, equities and derivatives and investment funds. As a proven, resilient capital market infrastructure, Euroclear is committed to delivering risk-mitigation, automation and efficiency at scale for its global client franchise. The Euroclear group comprises Euroclear Bank, the International and Irish CSD, as well as Euroclear Belgium, Euroclear Finland, Euroclear France, Euroclear Nederland, Euroclear Sweden, Euroclear UK & International.

About BMO

BMO Financial Group is the eighth largest bank in North America by assets, with total assets of $1.4 trillion as of April 30, 2024. Serving customers for 200 years and counting, BMO is a diverse team of highly engaged employees providing a broad range of personal and commercial banking, wealth management, global markets and investment banking products and services to 13 million customers across Canada, the United States, and in select markets globally. Driven by a single purpose, to Boldly Grow the Good in business and life, BMO is committed to driving positive change in the world, and making progress for a thriving economy, sustainable future, and inclusive society.

Media Contacts

Harsha Jethnani                    harsha.jethnani@citi.com                                          +65 6657 4892