Govt gives nod to IFC's taka bond

The taka is set to make its debut in the international bond market as the government gave approval to the International Finance Corporation's proposal to an offshore bond worth $1 billion, equivalent to Tk 7,800 crore.

Bangladesh Bank Governor Atiur Rahman and a senior official of the finance ministry confirmed the update on the taka-denominated bond, which will be invested in private infrastructure and public-private partnership projects.

"We have formally approved the IFC's proposal," said the ministry official.

Rahman praised the move, saying it would expand Bangladesh's investor base.

Now, the finance ministry, the central bank and the IFC will sit together to finalise the terms and conditions of the bond, the governor told The Daily Star by phone from Peru yesterday.

Earlier in April this year, the IFC, the private sector arm of the World Bank Group, floated the idea of issuing the "taka bond" in the international market in a bid to raise funds for local use.

Finance division, economic relations division and the central bank examined the IFC proposal and finally gave the nod last week.

The IFC will take care of the currency fluctuation, said the governor.

Rahman said the new bond would provide a benchmark for further bond issuance in Ba3/BB-/BB- rated category and will help Bangladesh's domestic corporate bond market to grow, he said.