African Domestic Bond Fund

Foreword from the African Development Bank

The African Development Bank (AfDB), through its African Financial Markets Initiative (AFMI), is pleased to sponsor and act as an anchor investor [USD 25 million] for the African Domestic Bond Fund (ADBF), the first* multi-jurisdictional fixed income Exchange Traded Fund (ETF) on the continent. The ADBF will track the performance of the AfDB/AFMISM Bloomberg® African Bond Index 25% Capped, an index comprised of African local currency sovereign bonds, and will help provide an important source of funding for local African governments, improve liquidity in local markets and create benchmarks for investors.

The AfDB’s investment is in line with its long-standing commitment to the growth of African domestic capital markets and further enhances the various financing and non-financing activities it has undertaken to provide better market access for governments and corporates.

The AFMI was designed in 2008 to promote the development of African domestic debt markets by strengthening market infrastructure and investing in local currency denominated debt.Through this ongoing initiative, AfDB continues to pursue the following goals:

i. Encourage the creation and adoption of African bond indices;

ii. Improve liquidity in African local capital markets;

iii. Contribute to the improvement of operational aspects of African bond markets (e.g. settlement systems, data collection and dissemination through its platform etc.);

iv. Increase the pool of sophisticated African fund managers, contributing to skills transfer into Africa; and

v. Establish new financial products on the African continent.

As Africa’s premier development institution, the AfDB will continue supporting strong financial systems in Africa given the important role it plays in the economic and social progress of the continent.

ADBF will be managed by an external, duly licensed, Mauritian fund manager, namely MCB Investment Management Co. Ltd (MCBIM or the Manager).

Download PDF version of ADBF guide.

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