The New Development Bank, the multilateral financial institution aiming to support infrastructure and sustainable development projects in emerging markets and developing countries, announced on Thursday the issuance of a $1.25 billion three-year benchmark green bond, which is the bank's first US dollar-denominated green bond and part of its efforts to further explore the sustainable finance capital market.

The newly released bond is part of the NDB's 50 billion euros ($55 billion) medium-term note program.

The majority 78 percent of the total issuance is subscribed by central banks and official institutions, with the rest taken up primarily by bank treasuries and asset managers. More than 50 international investors have purchased the bond.

Net proceeds from the issuance of the bond will be allocated to finance eligible green projects defined in the NDB's sustainable financing policy framework, which the bank released in May 2020 to govern the issuance of green, social and sustainability debt instruments.

Leslie Maasdorp, vice-president and chief financial officer of NDB, said that the bank has successfully re-tapped the USD bond market with this latest issuance. The bank has a robust pipeline of green and sustainable projects in its member countries to finance, he said.

The NDB, therefore, intends to deepen its green and ESG (environmental, social and governance) credentials with new issuances in the sustainability-linked format in the months ahead, he added.

Citi, Credit Agricole CIB, HSBC and ICBC acted as the joint lead managers for the green bond issuance.

Experts from ICBC (Asia) admitted that the bond issuance has been made at a time when the global market is complicated with various uncertainties and challenges. However, ICBC has seen the rising demand for bonds issued by sovereigns, supra-nationals and agencies via the issuance of NDB's new product.

Headquartered in Shanghai, the NDB was founded by Brazil, Russia, India, China and South Africa in 2014. The bank formally opened in July 2015.

Since its establishment, NDB has approved over $33.2 billion in loans for 98 projects in developing countries. Aside from the five BRICS nations, the bank has included Bangladesh, the United Arab Emirates, Egypt and Uruguay in its list of members over the past few years, according to the NDB.

In late October, the NDB issued a three-year 3 billion yuan ($435 million) bond in the China Interbank Bond Market with a yield of 2.53 percent. The bank approved $875 million in late July for water, sanitation, ecotourism and transportation projects in Brazil, China and India.