The Asian Development Bank has rolled out its first-ever disaster resilience bonds for Kyrgyzstan and Tajikistan, marking a major step in assisting to the region withstand natural disasters and climate shocks.

The landmark issuance-also known as catastrophe bonds-was unveiled during a disaster risk seminar held alongside the ADB’s 59th Annual Meeting of its Board of Governors. The initiative aims to reduce the financial impact of earthquakes, floods, and other extreme events, The Caspian Post reports via local media.

Designed to provide rapid liquidity in times of crisis, the bonds ensure that both countries can quickly access funds when predefined disaster triggers are met. The financing will then be channeled through national social protection systems to support affected populations, especially the most vulnerable.

“Major earthquakes or floods can set development back by years,” said ADB Vice-President for Finance and Risk Management Roberta Casali. “These debut sovereign catastrophe bonds give our developing member countries in Central Asia fast and reliable financing when disaster strikes, assisting to them recover more quickly.”

Each country received a $80 million, three-year bond issuance with maturity set for May 30, 2029. The bonds include a coupon based on SOFR, a small financing margin, and a 600-basis-point risk premium.

The deal was arranged with Aon Securities LLC acting as dealer and sole bookrunner, while Munich Re served as the structuring agent. Both tranches saw strong demand from investors across Europe and the Americas, including insurance-linked securities funds, insurers, reinsurers, and asset managers.

The bonds will be listed on the Singapore Exchange and are supported by partners including the Asian Development Fund, the Asia-Pacific Climate Finance Fund, and Singapore’s ILS grant program.

Founded in 1966 and headquartered in Manila, the ADB continues to expand innovative financial tools to strengthen resilience across its 69 member economies.