The Philippines, among the world’s most disaster-prone nations, sold its maiden foreign-currency catastrophe-linked bonds to help cover costs of major calamities, in conjunction with the World Bank.

The dual-tranche transaction consists of a $150 million issuance against losses from tropical cyclones, and up to $75 million protection from earthquake damage, for as long as three years, according to a press release from the World Bank today.

The so-called cat bonds would help meet rebuilding costs after major natural disasters. The Philippines is battered by about 19 typhoons annually, which bring strong winds and heavy rain. As well as being lashed by such extreme weather conditions, the country sits on the “Pacific Ring of Fire” and is prone to earthquakes and volcanic eruptions.

“The World Bank cat bond is a vital building block to our long-term disaster risk and insurance strategy, which we have been steadily establishing since the aftermath of Typhoon Ketsana and Parma in 2009,” Philippines Treasurer Rosalia de Leon said in the statement. “This instrument addresses the financing gap for immediate post-disaster needs for extremely high-risk events.”

Issuers of cat bonds, usually insurers, pay higher yields but interest payments or the principal are wiped out in the event of a major natural disaster.

The catastrophe bond is the first of its kind sponsored by an Asian government, according to Michael Bennett, head of derivatives & structured finance at The World Bank. He sees potential for such bonds to be sold for other countries in the region including Indonesia and Thailand.

The bonds were sold at par, and the coupon is three-month dollar Libor plus funding and risk margins. The funding margin for both tranches is minus 0.12% per annum, while the risk margin is 5.65% for the $150 million and 5.5% for the $75 million. About 58% of the deal was sold to European investors. Asset managers globally bought 50% of the offering.

For years, the Southeast Asian nation has been considering its debut overseas cat bond, and in 2015 it looked to raise as much as $1 billion from such debt. Yet complexity of pricing and modeling disaster risk delayed the offer. The offering will help the country manage its risks.

“The Philippines is one of the most disaster prone countries in the world,” said Mara Warwick, country director for Brunei, Malaysia, Philippines and Thailand at The World Bank. “Whenever disasters strike, they particularly hit the poor.”

The joint structuring agents, joint bookrunners and joint managers were GC Securities, a division of MMC Securities LLC, and Swiss Re, while Munich Re was a joint structuring agent, placement agent and joint manager, according to today’s release. AIR Worldwide is the risk modeler and calculation agent.

(Adds comments from the World Bank in sixth and ninth paragraph)

–With assistance from Anand Menon and Joyce Koh.