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ADB weighs expanding risk-layered disaster bonds for Mongolia
The program being discussed would extend the ADB’s risk-layered approach after its first issuances, which raised $160 million across sovereign catastrophe bonds for Kyrgyzstan and Tajikistan.
The Asian Development Bank is discussing how to replicate its risk-layered disaster relief finance program in Mongolia, using sovereign parametric risk transfer instruments that can include catastrophe bonds, Artemis reports.
The initiative follows the ADB’s first risk-layered disaster relief finance program earlier this year in Kyrgyz Republic and Tajikistan. That project combined Contingent Disaster Financing with the bank’s first Disaster Relief Bonds, securing $160 million of capital-market backed parametric earthquake and extreme precipitation disaster risk financing.
Of that $160 million, the issuance was split evenly between Asian Development Bank – Kyrgyz Republic 2026 and Asian Development Bank – Tajikistan 2026 catastrophe bonds. The ADB is now looking to expand the model to more natural-hazard exposed member countries.
Artemis says the ADB has started a new project involving talks with Mongolia’s government to assess options for strengthening the country’s disaster risk financing architecture, including an evaluation of feasible financial instruments and the institutional, legal, and regulatory requirements to adopt structured sovereign coverage.