Home / Business and Economy / World Bank Pioneers $510M Emerging Market Securitization Deal
World Bank Pioneers $510M Emerging Market Securitization Deal
29 Aug
Summary
- World Bank packages $510M in loans to 57 companies into a CLO
- Moody's gives top tranche Aaa rating despite not rating underlying loans
- World Bank aims to build asset class around emerging market securitizations
As of August 29th, 2025, the World Bank has made a significant foray into the world of securitization. In a first-of-its-kind move, the development lender has packaged $510 million worth of loans made to 57 companies across emerging markets into a collateralized loan obligation (CLO), a Wall Street-style financial instrument.
This groundbreaking deal was structured by Goldman Sachs, and the most senior $320 million tranche of the CLO has been given the highest Aaa rating by Moody's. This rating was awarded despite Moody's not actually rating the underlying loans, a testament to the structuring quality and portfolio diversification.
The World Bank's foray into the CLO market is part of a broader strategy to offload loan risk to private investors, freeing up its own capital to lend more and faster. According to World Bank president Ajay Banga, this is just the opening act in the bank's push to build an asset class around emerging market securitizations. Investors, on the other hand, are being offered a rare opportunity to access high-grade yield tied to growth markets.
In a market starved for yield and diversification, this new breed of CLO could become one of the most compelling and quietly scalable credit stories of the decade. The World Bank is effectively grafting Wall Street DNA onto development finance, leveraging the expertise of partners like Goldman Sachs to unlock new sources of capital for its lending operations.
