- Türkiye İş Bankası issued a $100 million digital native note (DNN) using distributed ledger technology on Euroclear’s D-FMI platform.
- The International Finance Corporation (IFC), part of the World Bank Group, was the only investor in this transaction.
- Funds raised will support small businesses and farmers affected by the 2023 Turkish earthquake.
- This is the first time a private bank has used the Euroclear D-FMI digital bond platform.
- Citi acted as sole dealer for the bond, while R3’s Corda provided the underlying blockchain technology.
Türkiye İş Bankası has issued a $100 million digital bond for five years on Euroclear’s D-FMI, a platform using distributed ledger technology. The International Finance Corporation (IFC) purchased the entire issuance. The proceeds will go to support small and medium businesses as well as farmers affected by the 2023 earthquake in Türkiye.
The digital bond, called a digital native note (DNN), offers a floating interest rate based on the six-month SOFR, and follows UK law. Citi served as the sole dealer and handled the issuance and payments. Legal support for the IFC came from Linklaters. The D-FMI system uses R3’s Corda blockchain network, which records transactions in a secure and transparent way.
İşbank is the first Turkish institution and the fourth overall to use the Euroclear D-FMI platform. Earlier issuers were all development finance institutions—the World Bank was first in 2023, followed by the Asian Infrastructure Investment Bank (AIIB) in Beijing, and French state-owned Caisse des Dépôts (CDP). CDP’s deal also used a trial for a wholesale central bank digital currency.
This bond marks a departure for the platform. “This issuance demonstrates how digital innovation and sustainable finance can go hand in hand, while maintaining the same regulatory certainty, liquidity, and settlement efficiency as with traditional bonds,” stated Isabelle Delorme, Head of Product Strategy and Innovation at Euroclear.
A digital native note is a security created and managed exclusively on a digital ledger, or blockchain—a type of secure, shared record-keeping technology. The D-FMI is Euroclear’s distributed financial market infrastructure, which handles bond registration and settlement using these advanced systems.
In previous deals, issuances were led by international finance groups. With İşbank now participating, the platform expands to include private sector involvement.
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