The Asian Development Bank (ADB) has issued its first tranche of disaster relief bonds (DRBs), also known as catastrophe bonds, with two deals covering earthquake and extreme precipitation risks in Tajikistan and the Kyrgyz Republic.
The DRB will provide rapid, targeted financial support to both countries following a severe earthquake or flood event, based on predefined and independently verified parametric triggers.
Following the occurrence of a qualifying disaster, proceeds will be disbursed through the national social security system to support those affected, especially the most vulnerable.
“When a major earthquake or flood occurs, it can set development back years,” said Roberta Casali, ADB’s vice president for finance and risk management.
“By issuing the first-ever sovereign catastrophe bond, our developing member countries in Central Asia have access to fast, committed financing when a disaster strikes, allowing them to rebuild faster. The bond will pave the way for future issuances and, over time, deepen investor engagement in this dynamic region.”
The size of both issuances is US$80 million, with a three-year term and a maturity date of May 30, 2029.
The Kyrgyz Republic DRB’s coupon (annual) consists of the compound Secured Overnight Financing Rate (SOFR) plus a funding margin of 4 basis points and a risk margin of 600 basis points.
Tajikistan DRB’s coupon (annual) consists of compound SOFR plus a funding margin of 4 basis points and a risk margin of 600 basis points.
Aon Securities LLC is acting as dealer, initial purchaser and sole bookrunner, and Munich Re is acting as exclusive structuring agent.
Both segments achieve broad primary market distribution. 64% of Kyrgyz Republic DRB’s bonds are placed in Europe and 36% in the Americas. By investor type, the investment ratio of professional insurance-related securities funds was 37%, that of insurance/reinsurance companies was 32%, and that of fund management companies was 31%.
For Tajikistan DRB, 60% of bonds are allocated in Europe and 40% in the Americas. By investor type, professional insurance-related securities funds accounted for 36%, re/insurance companies accounted for 33%, and fund management companies accounted for 31%.
The notes will be listed on the Singapore Exchange.
The project is supported by the Asian Development Fund, the Asia-Pacific Climate Finance Facility and the Monetary Authority of Singapore’s Insurance-Linked Securities Grant Scheme, which is funded by the Financial Sector Development Fund.
In preparation for the transaction, ADB is supporting the Kyrgyz Republic and Tajikistan through dedicated regional technical assistance under the Central Asia Regional Economic Cooperation Program. Analytical and advisory work is conducted by an international consortium led by WTW.
For more information about ADB Kyrgyz Republic 2026 or Tajikistan 2026 Cat Bonds or other cat bonds and related ILS transactions, please visit our sister publication Artemis’ Deal Directory.
“We are pleased with the strong response from the global investor community, whose support further shifts sovereign disaster risk from the public to the private sector,” said Jordan Brown, managing director for Asia Pacific at Aon Securities.
Leonie Schubert, Global Head of Capital Partners at Munich Re, added: “Munich Re is proud to support ADB’s inaugural catastrophe bond tranche. We congratulate ADB on these innovative, tailored and successful capital markets risk transfers that push the boundaries of insurability by introducing risks from new regions into the catastrophe bond market.”
“This risk-stratified approach provides each country with financing options for different event severity, while linkages to social security systems are designed to ensure DRB disbursements reach those most affected,” said WTW Senior Director Christopher Au.
