The World Bank issued “pandemic bonds” in 2017 with an interest rate of 12% that were set to mature in July 2020, with one catch: If “coronavirus“ became a pandemic – and in 2017 they called Coronavirus by name – then investors would lose all their money.
What will not surprise many is that TWP leans on Bill Gates’s assessments of the state of affairs within in the US’s healthcare system but that of of the entire globe…
Critics say the “insanely complicated” terms of the high-interest bonds are heavily skewed towards investors, while for the victims any payouts may come too late, if at all. One economist described the bonds, payouts from which depend on how deadly the outbreak is, as “obscene”.
Investors in World Bank’s ‘pandemic bonds’ face big losses due to the coronavirus outbreak
Those bonds, issued by the World Bank’s International Bank for Reconstruction and Development in 2017, were designed to pay out funds to countries which need help to contain a pandemic.
- The World Bank 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 cases surging.
- 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 saying that the price should have dropped more than 80%.