Top-rated sustainability

An impact investing alternative to US Treasury bonds

29 jan 2019

Multilateral Development Bank (MDB) bonds offer a highly rated, sustainable, and liquid yield enhancement for fixed income investors. UBS Asset Management has partnered with Solactive to develop a family of indices focused on the MDB bond market. MDB bonds are essentially a developing nation social and economic development capital source. They exhibit a solid and well established credit profile, both in terms of rating and implicit guarantees.

The Solactive UBS MDB Bond USD 25% Issuer Capped Index captures a selection of bonds from the largest MDBs within the G7 group of countries from the following issuers:

International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC) and International Development Association (IDA), Inter-American Development Bank, Asian Development Bank, European Bank for Reconstruction & Development, and the African Development Bank.

Key points:

Sovereign-rated impact lending: Multilateral Development Banks provide loans to developing countries at competitive rates, and are backed by member governments which create a quasi AAA-rated pool of impact-investible bonds.

Yield enhanced: Assuming no major credit events, MDB bonds offer a 0.14% yield enhancement over comparable US Treasuries (historical range 0.1% – 0.45% with no history of MDB default).

Highly liquid alternative to US Treasuries: MDB bonds offer credit risk sensitive investors access into one of the most liquid bond markets.

25% issuer capped with 100 individual bonds ranging from 0.15% to 2.34% of the index.

UBS Asset Management remains at the forefront of sustainable and impact investing innovation. By offering an impact alternative to US Treasuries, we further empower investors to generate superior returns whilst facilitating global change.


Discover our indexing solutions

Important legal information

To proceed, please confirm that you are a professional / qualified / institutional client and investor.


This content is for professional clients only. It is not to be distributed to or relied upon by Retail Clients under any circumstances.

Other countries:

Views and opinions expressed are presented for informational purposes only and are a reflection of UBS Asset Management’s best judgment at the time a report or other content was compiled. UBS specifically prohibits the redistribution or reproduction of this material in whole or in part without the prior written permission of UBS and UBS accepts no liability whatsoever for the actions of third parties in this respect. The information and opinions contained in the content of this webpage have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good faith but no responsibility is accepted for any errors or omissions. All such information and opinions are subject to change without notice but any obligation to update or alter forward-looking statement as a result of new information, future events, or otherwise is disclaimed. Source for all data/charts, if not stated otherwise: UBS Asset Management.

Any market or investment views expressed are not intended to be investment research. Materials have not been prepared to address requirements designed to promote the independence of investment research and are not subject to any prohibition on dealing ahead of the dissemination of investment research. The information contained in this webpage does not constitute a distribution, nor should it be considered a recommendation to purchase or sell any particular security or fund. The materials and content provided will not constitute investment advice and should not be relied upon as the basis for investment decisions. As individual situations may differ, clients should seek independent professional tax, legal, accounting or other specialist advisors as to the legal and tax implication of investing. Plan fiduciaries should determine whether an investment program is prudent in light of a plan's own circumstances and overall portfolio. A number of the comments in the content of this webpage are considered forward-looking statements. Actual future results, however, may vary materially. Past performance is no guarantee of future results. Potential for profit is accompanied by possibility of loss.

© UBS 2021 The key symbol and UBS are among the registered and unregistered trademarks of UBS.