Bondholders who ponied up premiums in 2017 after SAARS, will either reap massive profits or lose hundreds of millions of dollars as the coronavirus outbreak escalates. Investors holding the bonds enjoy higher-than-average interest rates, but stand to lose their cash in the event of a pandemic, these bonds came into play in December 2019 after the escalation of the Coronavirus.

If certain criteria are met, the bonds’ principal is transferred to the World Bank’s Pandemic Emergency Financing Facility (PEF) to fund containment and relief efforts.

“We are leveraging our capital market expertise, our deep understanding of the health sector, our experience overcoming development challenges, and our strong relationships with donors and the insurance industry to serve the world’s poorest people,” Jim Yong Kim, World Bank Group‘s president, said in a 2017 statement, adding that the PEF can “potentially save millions of lives.”

The bank issued two tranches of pandemic-linked bonds and derivatives collectively worth $425 million in 2017. Bondholders enjoyed more than two years of strong returns and little to worry about as few outbreaks came close to triggering the bonds’ total default.

But the stability of the investment has suddenly been thrown into question as the deadly coronavirus spreads globally.

The two tranches of pandemic bonds represent different risks of contagion. The World Bank offered $225 million worth of Class A debt, which payout 6.9% annually. The bonds default if pandemic-related deaths reach 2,500 in a single nation with an additional 20 or more deaths confirmed in an overseas country, according to the bank’s prospectus.

The Class B bonds have a lower bar for the debt to trigger and accordingly boast a higher interest rate since holders are assuming more risk. The bonds pay 11.5% annually but reach default after 250 deaths. The bonds’ payout rate scales with the number of additional countries that experience than 20 confirmed deaths. The World Bank issued $95 million worth of the Class B assets.

While the World Bank touts the debt as an efficient way to connect financial markets with epidemic relief, others have their doubts that the bonds help ailing nations at all. The assets’ lengthy prospectus hides numerous requirements that gum up any effort to release funds when they’re most needed, according to Olga Jonas, a senior fellow at the Harvard School of Public Health at Harvard University and former World Bank economist.

Funds can only be released from the PEF for non-flu epidemics 12 weeks after the “start of the event,” according to a World Bank document. The novel coronavirus strains were first reported on in late December, leaving funds locked up until late March.

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