1. Home
  2. Update

Investors in World Bank’s ‘pandemic bonds’ face big losses due to the coronavirus outbreak

Source(s): CNBC
Upload your content

By Weizhen Tan

Investors are looking at big losses in two World Bank-issued “pandemic bonds,” which have fallen under the spotlight as the coronavirus outbreak continues to spread worldwide.

[…]

The bonds offer investors high interest payments in return for taking on the risk of losing a certain amount or all of their money if pandemics occur. That includes the current coronavirus pandemic.

[…]

But prices of those bonds have plunged as investors flee with the number of infection cases surging. Growing fear about the economic fallout of the outbreak has driven a sell-off in risk assets as investors seek the perceived safety of government bonds like U.S. Treasurys.

[…]

According to ratings agency DBRS Morningstar, investors who hold the riskier of the two bonds could be losing their entire principal amount soon, with the firm telling CNBC that the price should have dropped more than 80%.

[…]

Read the original story here

Editors' recommendations

Explore further

Hazards Epidemic and Pandemic
Themes Economics of DRR
Country and region United States of America

Please note: Content is displayed as last posted by a PreventionWeb community member or editor. The views expressed therein are not necessarily those of UNDRR, PreventionWeb, or its sponsors. See our terms of use

Is this page useful?

Yes No
Report an issue on this page

Thank you. If you have 2 minutes, we would benefit from additional feedback (link opens in a new window).