The Asian Infrastructure Investment Bank (AIIB) has successfully issued its first digitally native note (DNN) on Brussels-based central securities depository Euroclear’s Digital Financial Market Infrastructure (D-FMI) platform, marking the first digital issuance in US dollars for Euroclear and the first such issuance by an Asia-based issuer on its platform.

The initiative was supported by BMO Capital Markets as dealer, with Citi also serving as dealer as well as the issuing and paying agent on the transaction. Clearing of the bonds is also possible on the Hong Kong Monetary Authority’s Central Moneymarkets Unit (CMU) and the SIX Swiss Exchange (SIX).

The DNN, boasting an AAA by Moody’s, Standard and Poor’s and Fitch Ratings, successfully raised US$300 million to support the AIIB’s sustainable development bond programme. The note is listed on the Luxembourg Stock Exchange.

The issuance was done via Euroclear’s digital securities issuance service, which enables the issuance, distribution and settlement of fully digital international securities on distributed ledger technology.

This DNN issuance further demonstrates the capabilities of its 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, the depository fully integrated the D-FMI platform with its traditional settlement system, ensuring European Central Securities Depositories Regulation compliance.

“Not only is this the first US dollar 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,” adds Domenico Nardelli, AIIB’s treasurer. “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.”