ADB, AIIB back Pakistan's historic Panda Bond

May 15, 2026 (MLN): The Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB) have joined forces to back Pakistan's debut Panda bond, which marks the first time a partial credit guarantee has been used to secure a domestic AAA rating in the People's Republic of China (PRC) for a bond with less than 100% guarantee coverage, setting a landmark precedent for mobilizing private sector capital in emerging markets.

The collaboration between the two multilateral lenders is being seen as a significant milestone in deploying guarantee mechanisms to help developing nations access the PRC's onshore capital market.

The CNY 1.75 billion (approximately $258 million) sustainable development bond was well received by investors, with confidence in the instrument attributed to the strength of the guarantee structure underpinning it, according to a press release issued.

It was noted by ADB Director General for Central and West Asia Leah Gutierrez that competitive pricing had been secured through the transaction, with the guarantee framework credited for enabling terms.

Proceeds from the bond are to be channelled into subprojects spanning water governance, energy efficiency, and healthcare capacity under Pakistan's Sustainable and Green Infrastructure Project.

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