The market for financial products to support renewable energies and the transition to sustainable business practices continues to evolve, with sustainability-linked bonds and loans soaring in growth.
Sustainable debt continued its rapid ascent last year, with volumes (loans and bonds) exceeding $1.6 trillion—double 2020’s totals—according to BloombergNEF. Green bonds alone surpassed $600 billion.
But the sustainable finance (SF) story isn’t about magnitudes alone. The structure of the debt began changing last year while the universe of potential issuers expanded. SF is no longer only about green projects for green companies. It is increasingly about corporations such as utility companies with high carbon emissions—often referred to as “brown” industries—raising funds for general business purposes but consenting along the way to cut greenhouse gas emissions or draw more power from renewable energy sources.
And if they fail to hit their performance targets? Then they pay investors a higher rate for their borrowed money. This roughly describes the structure of sustainability-linked financing, which exploded in 2021—only two years after Italy’s Enel Group issued the world’s first sustainability-linked bond (SLB) in 2019.
“In 2021, the sustainability-linked market came of age,” Sandrine Enguehard, head of Impact Finance Solutions at Societe Generale, tells Global Finance. Sustainability-linked features first emerged on the loan side in the late teens, especially with large revolving credit facility transactions. But since that time, the market “has evolved quickly, mostly driven so far by corporate issuers and representing 11% in 2021 of the total sustainable bond volumes,” says Enguehard.
“Sustainability-linked bonds truly arrived on the labeled-finance scene in 2021,” declares the Climate Bonds Initiative (CBI) in its 2021 Sustainable Debt report, with $188.8 billion in volume (from 277 issuances), up about 16-fold compared with $11.4 billion in 2020. Meanwhile, green bonds remained dominant, with a volume of $522.7 billion in 2021, a 75% advance from 2020.
But social bonds—use-of-proceeds instruments designed to have social impact—declined 13% year-over-year. Why the stumble? “Social bonds were most certainly driven by pandemic relief efforts, with $77 billion issued in the fourth quarter of 2020 and $92 billion issued in the first quarter of 2021,” says Matt Toole, Deals Intelligence director at Refinitiv. “Recent issuance trends have leveled off, and [we] would assume the social bond asset class will be a bit lumpier from quarter to quarter.”
Sustainability bonds—use-of-proceeds instruments that combine features of both green bonds and social bonds—fared better, rising to a record $200.2 billion in 2021, a 23% gain compared with $162.5 billion the previous year, according to the CBI report.
“A favorable interest rate environment and investor demand for sustainable investments helped to drive the record levels of overall activity, which accounted for 10% of global bond issuance in 2021, up from 7% for full year 2020,” says Toole.
More recently, there are even signs that SLBs are beginning to gain traction beyond corporations, according to Enguehard: “We are starting to see other types of issuers, such as financial institutions and sovereigns,” including asset manager ICG in Europe and the Republic of Chile in South America, both of which issued SLBs in early 2022.
More Popular In Emerging Markets?
Nigel Beck, head of SF at South Africa’s Rand Merchant Bank (RMB), agrees that sustainability-linked loans and bonds were eclipsing other use-of-proceeds instruments in growth rates if not sheer volume. “It’s happening everywhere, but it’s even more acute in Africa,” he tells Global Finance.
Why Africa? The typical issuance size on that continent isn’t as large as in some other parts of the world. In Europe, a green bond issuance could be $2 billion, but in Africa it’s likely to be closer to $100 million. This means some of the bonds’ fixed issuance costs loom larger in Africa—things like second-party opinions or developing the environmental, social and governance frameworks that are typically required for green bonds. These fixed costs aren’t as prominent with sustainability-linked debt instruments.
Overall, says Beck, there is a strong appetite for SF products, and there is relatively little supply. RMB’s client surveys have found that many investors still prefer traditional green bonds, though that may be because they simply are more familiar with them. But anything that expands the supply is generally viewed as a plus. RMB’s surveys also show that transition bonds, sometimes called brown bonds, which can be issued by energy companies that want to move closer to net-zero emissions, are becoming more popular as well.
As for sustainability-linked products specifically, RMB’s client surveys further show that many “investors believe that key performance indicator (KPI) targets are not ambitious enough,” and that issuers also need to provide “clear guidance on targets versus historical performance” as well as “global trends and comparison to peers.” In addition, “step-ups” (penalties for failing to achieve targets) need to be more than 10 basis points, in the opinion of 90% of debt investors surveyed.
What Lies Ahead In 2022?
Looking ahead, “we see the growing need to develop financing solutions for the decarbonation of the economy,” says Hacina Py, Societe Generale Group’s chief sustainability officer. “This requires banks to team up with industrials and with other actors along new cross-sectorial value chains to understand technological developments and design new financing schemes.” Beck believes that innovation will continue in the sustainable finance sector, which historically has provided mostly “vanilla” products. Sustainable derivatives or more short-term facilities could be coming soon.
Standard Chartered Bank, for its part, expects SLBs to continue their robust growth, possibly doubling volume in 2022. Overall issuance of green, social, sustainable and sustainability-linked (GSSS) bonds could reach $1.7 trillion in 2022—a 52% improvement over the previous year—and $4.2 trillion by 2025. (This doesn’t include loans.) In Standard Chartered’s scenario, GSSS would represent around one-third of overall global bond issuance in 2025—with SLBs potentially accounting for more than $1 trillion and “making up one-quarter of the entire GSSS market by that point.”
“I expect that all issuers—corporates, sovereigns and agencies—are assessing their financing needs for the foreseeable future,” adds Refinitiv’s Toole, “particularly considering the changing interest environment. Some historical bonds may be coming to maturity, which may also drive new issuance levels.”
With this as preamble, Global Finance presents its second annual Sustainable Finance Awards, with honorees across 63 countries, territories and districts and seven geographic regions, including global honorees in 13 debt categories.
Methodology: Behind the Rankings
Global and regional awards require submissions detailing hard measures of ESG activity, such as year-on-year growth in sustainable instruments or green bonds as a precent of total bonds, as well as softer metrics such as goal alignment with leading ESG norms or innovative product development. Entries were not required for country, territory and district awards, which were judged by the editorial team’s independent research. Criteria for evaluation in both cases include governance policies and goals, achievements in environmental and social sustainability financing, industry leadership and third-party assessments. This awards program covers the activities from January 2021 to December 2021. There was no fee to enter.
SOCIETE GENERALE
Overall Outstanding Leadership in Sustainable Finance
Societe Generale (SocGen) stands at the forefront of the sustainable finance movement, and its reach is truly global. In its native Europe, SocGen has led the charge into sustainability-linked bonds (SLBs); while in the Asia-Pacific (APAC) region, it has pioneered social bonds. In Africa, SocGen has been active in sustainable project finance in Benin, Angola and Senegal.
The pace hasn’t slackened in 2022. In March, the bank was active bookrunner and joint sustainability structuring adviser for the first-ever sustainability-linked sovereign bond, the Republic of Chile’s $2 billion 20-year offering. The South American government will need to hit key performance indicators tied to reducing greenhouse gas (GHG) emissions and increasing the share of renewable energy in its national electric system. If it misses one target, the coupon rate it pays investors will rise 12.5 basis points. If it misses both targets, the step-up is 25 basis points.
SocGen received a top AAA rating in 2021 from environmental, social and governance (ESG) rating firm MSCI, placing it in the top 3% among the 190 banks in its peer group. It also made the top 1% among 4,944 companies rated by Moody’s ESG 2021 (formerly Vigeo Eiris). —Andrew Singer
BBVA
Outstanding Leadership in Green Bonds
Throughout 2021, BBVA issued a host of green, social and sustainable bonds for clients based in the United States, Mexico, South America, Asia and Europe. Among those, total disintermediated bond volume for 2021 totaled €6.7 billion (about $7 billion)—a 60% increase over 2020’s €4.2 billion tally.
The lion’s share of these funds is represented by an inaugural 20-year, €5 billion green bond issued by the Kingdom of Spain. BBVA acted as green structuring bank and active bookrunner for this effort. Proceeds will be used to bring renewable energy to Spain, along with clean transportation, sustainable water usage, wastewater management, projects to boost energy efficiency, and more.
BBVA’s role in the Spanish bond builds on the bank’s history of green bond issuances. Its drive for sustainable finance began in 2007, when it took part in the first issue of a green bond, placed by the European Investment Bank. Currently, it also does significant green bond work in Mexico. In 2021 alone, BBVA Mexico acted as joint bookrunner in the issuance of 18 ESG-related bonds. —Laura Spinale
STANDARD CHARTERED
Outstanding Leadership in Social Bonds
Outstanding Sustainable Financing in Emerging Markets
Standard Chartered has furthered social bonds on a global scale—from Central America to Western Europe to East Asia. In June 2021, the bank acted as joint lead manager and joint bookrunner for a €1 billion social bond for Korea Housing Finance. In August 2021, Standard Chartered and French multinational electric utility EDF announced the world’s first corporate social hybrid bond. The bank was also joint lead manager and joint bookrunner for the first social bond issued by a financial institution in Central America: Central American Bank for Economic Integration’s $500 million issuance.
While it is based in the UK, 84% of Standard Chartered’s sustainable finance assets are in Asia, Africa and the Middle East—and it was also honored this year for bringing sustainable finance to emerging markets. It was the top bookrunner in the APAC region for green loans, according to Dealogic. It also acted as sole underwriter, joint mandated lead arranger, green-loan coordinator and bookrunner for the largest-ever project financing in the renewables sector in India, Adani Green Energy’s $1.35 billion finance facility to fund construction of solar-wind hybrid renewable power projects. —AS
ING
Outstanding Leadership in Sustainable Bonds
ING issued its first green bond in 2015 and hasn’t lifted its foot off the ESG pedal since.
In April 2021, it served as joint active bookrunner and sole sustainability structuring agent for FedEx’s €600 million sustainable bond issuance, the first sustainability bond from a North American transport and logistics company. (Sustainable bonds combine elements of both green bonds and social bonds.)
In 2021, ING was second for green, social and sustainability eurobond issues globally with more than €7.5 billion in bonds issued, up from €3.8 billion in 2020, when it placed fourth, according to Bloomberg’s league tables. —AS
DBS
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Financial Leadership in Sustaining Communities
In 2021, Singapore’s DBS committed a total of 20.5 billion Singapore dollars (about US$14.8 billion) to sustainable finance transactions. Among these were transition/sustainability-linked bonds and efforts to build sustaining communities.
DBS led Asia’s ESG bond market in 2021. It acted as bookrunner and adviser for two series of bonds for New Development Bank, earmarked to finance sustainable infrastructure and development projects in China. Other transition/sustainability-linked bonds include an SG$1.65 billion bond for the Singapore National Environment Agency. That bond will finance sustainable waste-management projects in Singapore. A US$350 million bond for Japfa Comfeed Indonesia will help the global agrifood business construct water-recycling facilities.
Projects for sustainable communities include acting as coordinator for a 13 billion Hong Kong dollar (about US$1.7 billion) five-year green loan to the Hysan Development Company and the Chinachem Group. This is the largest green loan ever issued in Hong Kong. It will ensure that a commercial development project will be built sustainably and benefit the community—serving up 60,000 square feet of urban parkland, as well as footbridges to enhance connectivity and walkability. Buildings constructed as part of this project will use renewable energy, conserve water and provide ecologically friendly wastewater management. —LS
SANTANDER
Outstanding Leadership in Transition/Sustainability-Linked Loans
Santander acted as joint sustainability coordinator for the largest-ever sustainability-linked loan revolving credit facility (RCF) in 2021: Anheuser-Busch InBev’s $10.1 billion sustainability-linked RCF, the first among publicly listed companies in the alcohol beverage sector. If AB InBev hits performance targets in four key areas by 2025—improving water efficiency, reducing GHG emissions, increasing recycled PET (polyethylene terephthalate) content and using renewable energy sources—it will lower its borrowing costs.
Elsewhere, the Spanish bank partnered with the UK’s Tesco in 2021 to offer sustainability-linked supply chain finance to Tesco’s supplier base. Santander was also part of a group that supported the Hill Group, which builds houses, in refinancing its portfolio with a £220 million (about $269 million) sustainability-linked loan in December. —AS
BANK OF CHINA
Outstanding Leadership in ESG-Related Loans
Bank of China has organized ESG-related loans and green loans worldwide. It served as a mandated lead arranger and interest rate hedging bank for Dogger Bank Wind Farm in the North Sea, the world’s largest offshore wind facility. Similarly, in the United States, the bank helped fund Vineyard Wind’s 10-year $2.4 billion offshore wind-power project. —LS
SCOTIABANK
Outstanding Leadership in Sustainability Transparency
Canada’s Scotiabank is striving to mobilize 100 billion Canadian dollars (about US$77 billion) by 2025 to reduce the causes and impacts of climate change. As of October 2021, it had mobilized more than CA$58 billion. These funds are distributed in accordance with Scotiabank’s environmental policy, which includes internal and external efforts in assessment, mitigation, advancement of industry dialogue and transparent public reporting.
Report it does. Annually published ESG reports merge with reports on climate commitments, responsible investment policies and financing goals, to give the public a clear idea of bank activities and positions. Scotiabank additionally publishes anti-money laundering and anti-terrorist financing statements and carbon neutrality reports. Its supplier code of conduct outlines sustainability obligations of third-party suppliers, service providers and others that serve the bank. This code covers obligations in the fields of ethical business and employment practices, corporate responsibility and environmental stewardship. —LS
CITI
Outstanding Leadership in Sustainable Infrastructure Finance
In April 2021, Citi announced its goal to finance $1 trillion in sustainability offerings by 2030. Half of these funds are earmarked for addressing the ESG challenges outlined in the Paris Agreement and the UN’s Sustainable Development Goals. Aligned projects cover clean technology, green building, renewable energy, sustainable transportation and more. The other half of the $1 trillion is dedicated to social financing, including investments in affordable housing and sustainable infrastructure.
Citi’s nearly $160 billion in ESG-linked projects financed or facilitated in 2021 include Greenlight Planet’s $75 million transaction to expand access to off-grid solar energy in Kenya; and at the lower end, $3 million in working capital (to top a previous $5 million loan) to help the d.light solar energy company deliver energy to 759 million people in Africa, China, South Asia and the United States. Additionally, Citi’s Mexican arm, Citibanamex, acted as joint bookrunner for a $500,000 bond that helped Banco Nacional de Obras y Servicios Publicos, Sociedad Nacional de Credito—a state-owned Mexican development bank—for essential infrastructure projects. These include fixing infrastructure damaged by natural disasters; building wind farms, photovoltaic plants and hydroelectric plants; designing sustainable transportation systems; and building wastewater treatment plants, among other projects. —LS
BANK OF AMERICA
Outstanding Leadership in Sustainable Project Finance
In 2021, nearly 11% of Bank of America’s bond and loan underwriting volume was ESG related, compared with only 4.3% in 2020. In 2021, the bank devoted $6.6 billion from its Bank of America Community Development Banking initiative for innovative financing—$4.1 billion in debt commitments and $2.5 billion in investments—to fund affordable housing (for individuals, families, seniors, veterans, the homeless and those with special needs) and economic development across the United States. The bank also stood out for renewable energy financing in the Caribbean—for example, helping to finance InterEnergy Group’s efforts to bring multiple clean energy technologies to small island nations—and in Central and South America, starting with a project to bring approximately 800 MW of clean energy to the Caribbean. —LS
EBRD
Outstanding Leadership in Sustainable Finance by a Multilateral Institution
Founded in 1991, the European Bank for Reconstruction and Development (EBRD) is a multilateral developmental investment bank focused mostly on the Central and Eastern European region and North Africa. Its green finance activities totaled €5.4 billion in 2021, a new record, and accounted for more than half of EBRD’s total annual business investment. EBRD invested €75.5 million last year in a series of SLBs issued by PPC, Greece’s largest power utility. If the energy concern fails to reduce its carbon dioxide emissions 57% by year-end 2023, compared with a 2019 baseline, it will face a coupon step-up of 50 basis points, according to the terms of the SLBs. —AS
STANDARD BANK
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Social Bonds
Outstanding Leadership in Transition/Sustainability-Linked Loans
Outstanding Leadership in Sustainable Infrastructure Finance
Standard Bank is one of Africa’s most versatile players in the sustainable finance arena. Not only has it broken new ground with green bonds—the traditional environmental, social and governance (ESG) debt instrument of choice—but it has stood out with newer offerings like sustainability-linked loans (SLLs). The bank also excels in social bonds.
Between January 1, 2021, and March 31, 2022, Standard Bank executed 16 sustainable finance loans for the total value of 18.1 billion South African rands (about $1.1 billion). Three of these had a use-of-proceeds structure (e.g., green, social, or sustainable), and 13 were SLLs (i.e., performance based). During the same period, Standard Bank arranged 10 sustainable bonds for a total volume of R7.5 billion, of which five were green, social, or sustainable and five were sustainability linked.
Overall, sustainable financing (bonds and loans) grew 152% between 2021 and 2022—from R10.4 billion to R26.8 billion—including several firsts for Africa: the first sustainability-linked bond in Africa, the first social bond to be listed on the Sustainability Segment of the Johannesburg Stock Exchange (JSE), the first sustainability-linked loan in the retail sector in South Africa, and the first sustainability-linked working capital facility in South Africa.
Standard Bank’s R2 billion trailblazing social bond, for which it served as sole arranger and social-bond coordinator, was issued in August 2021 for the express purpose of financing mortgages in the affordable-housing sector “with a focus on female borrowers.” It received bids from 22 bidders and was 2.3 times oversubscribed.
NEDBANK
Outstanding Leadership in Green Bonds
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Sustainability-linked bonds (SLBs) exploded on the global scene in 2021, and South Africa’s Nedbank was an active participant: South Africa’s SLB volume, nonexistent in 2020, stood at R2.6 trillion by year-end 2021. In January 2022, Nedbank also concluded a R1 billion sustainability-linked revolving credit facility for Imperial Logistics, that firm’s first-ever sustainability-linked credit facility. Nedbank was active on the green bond front too, as volume rose to R2.1 billion in 2021. In December, Nedbank was arranger and sustainability coordinator for a R1.1 billion green development bond that was listed on the JSE’s Sustainability Segment. Funds will go toward financing green residential developments.
The bank ranks at the top end of its international peer groups in ESG ratings. Its AA MSCI rating puts it in the top third among banks globally, while its 4.3 score (out of 5) from FTSE Russell places it among the top 6% of banks globally.
ECOBANK
Outstanding Leadership in Sustainable Bonds
In June 2021, Togo’s Ecobank Transnational successfully raised $350 million tier 2 sustainability eurobond notes, the first such issuance by a financial institution in sub-Saharan Africa. Listed on the London Stock Exchange, the notes were issued to investors from various parts of the world and were oversubscribed. They were meant to help the company continue to make a social impact in the geographies where it operates, along with shoring up capital reserves.
ACCESS BANK
Outstanding Leadership in ESG-Related Loans
Financial Leadership in Sustaining Communities
Nigeria’s Access Bank has found innovative ways to combine green finance with support of its local communities. In 2021, for instance, it issued a $41 million green bond—certified by the Climate Bonds Initiative and verified by PwC—whose proceeds were to be used to finance ESG-oriented projects like flood defense, including protection for 400,000 Nigerian residents against flooding and preservation of more than 1,000 acres of land from rising sea levels. Green financing grew by about 10% in 2021 and accounted for about 5% of the bank’s total financial offerings.
BANK OF AFRICA
Outstanding Leadership in Sustainability Transparency
African banks are often not as transparent as institutions in other regions regarding sustainable finance activities, but few can complain about Bank of Africa in this regard. It publishes not only a Sustainability Report, but a Green Bond Report, an Equator Principles Report and an Integrated Report. The bank has also conducted a partial analysis of its loan portfolio using the UN Environment Programme Finance Initiative’s Portfolio Impact Analysis Tool. “Positive impact loans” now account for 30% of total loans disbursed to the bank’s Moroccan corporate customers.
Bank of Africa has been acknowledged also by ESG-ratings firm Vigeo Eiris, which ranked the Mali-headquartered institution in the top 2% of 4,880 companies globally in sustainability in 2021, and first among 90 in its Retail and Specialized Banks Emerging Markets sector.
RAND MERCHANT BANK
Outstanding Leadership in Sustainable Project Finance
Rand Merchant Bank (RMB) is a division of FirstRand Bank, one of the largest financial services groups in Africa. In June 2021, RMB provided 15-year term funding for the two 5 MW solar renewable energy projects of Tandii Investment and NCF Energy in Namibia, contributing to that nation’s infrastructure and the greening of its economy. It followed this in August 2021 by raising a senior debt facility for Matzonox’s biogas (i.e., waste to energy) renewable energy project in Rustenburg, South Africa. That project will generate green electricity, green thermal energy and processed water to a local chicken plant. Roughly a quarter of RMB’s overall debt capital markets volume in 2021 (27%) was from SLBs.
TDB (TRADE AND DEVELOPMENT BANK)
Outstanding Sustainable Financing in Emerging Markets
Outstanding Leadership in Sustainable Finance by a Multilateral Institution
Established in 1985, the Eastern and Southern African TDB (Trade and Development Bank) works with 22 economies in the region, with an emphasis on sustainable development. At the end of 2021, 79% of TDB’s portfolio exposure was for transactions having low or no environmental or social risk, compared with 73% at the end of 2020. In late 2021, TDB delivered $4.2 million to Kenya’s Sunspot Energy project to finance home solar systems for 6,000 households—a boon for a country where 25% of the population lacks access to electricity. TDB also supplied €100 million (about $106 million) for infrastructure projects in Uganda, where the government struggled economically in the wake of the Covid-19 pandemic. —AS
|
REGIONAL WINNERS: ASIA-PACIFIC
|
|---|
DBS
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Green Bonds
Outstanding Leadership in Sustainable Bonds
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Based in Singapore, DBS takes the award for outstanding leadership in sustainable finance in Asia-Pacific for its work in green bonds, sustainable bonds and transition/sustainability-linked bonds. In 2021, the bank committed to a total of 20.5 billion Singapore dollars (about US$14.8 billion) in sustainable financing transactions, 52% of its cumulative SG$39.4 billion in sustainability financing to date. It is striving to reach SG$50 billion in sustainability financing by 2024. Separately, it raised more than SG$23.5 billion in bonds for its customers.
Transition deals, designed to support customers’ move to lower-carbon business models, include a loan of SG$150 million for Toyota Financial Services. Proceeds will be used to increase electric-vehicle (EV) sales in Singapore. In India, DBS loans help the Reliance Industries conglomerate transition from coal to renewables for powering operations.
DBS’s green bond work includes acting as joint structure adviser and joint global coordinator for a US$400 bond helping Henan RCIC to incorporate green development into the design, construction, operations and management of its regional railway operations in Henan Province, China. A second significant deal entailed acting as joint lead manager and joint bookrunner for a US$500 million 10-year bond for Hongkong Land property investment and development company. The bond will fund green building, renewable energy, clean transportation and sustainable water management.
In the field of sustainability, DBS served as a joint lead manager and bookrunner for Nanyang Technological University’s SG$650 million 15-year bond—the world’s first publicly offered sustainability bond floated for a university. It will help the school achieve carbon neutrality by 2035 and reach other significant sustainability goals.
SOCIETE GENERALE
Outstanding Leadership in Social Bonds
In 2021, Societe Generale served as joint bookrunner for KEB Hana Bank’s inaugural €500 million social bond. The proceeds will be used by the South Korean institution to help improve financing for small and midsize enterprises (SMEs); advance and empower financially underprivileged people, including migrants, displaced persons and foreign workers; build affordable public housing; and participate in loans designed to help companies create jobs. Societe Generale also acted as joint bookrunner for a €550 million Korea Housing Finance Corporation bond. This bond is designed to help improve the housing welfare of low- and middle-income persons in South Korea, in part through the issuance of low-interest, fixed-rate loans.
BANK OF CHINA
Outstanding Leadership in Transition/Sustainability-Linked Loans
Outstanding Leadership in ESG-Related Loans
Outstanding Leadership in Sustainable Project Finance
Bank of China takes regional awards for outstanding leadership in transition/sustainability-linked loans, outstanding leadership in ESG-related loans, and for outstanding leadership in sustainable project finance. Green bonds constitute 6.75% of the bank’s bond underwriting, and 10.4% of its credit activities go toward green loans.
Notable transition/sustainability loans include the Bank of China Zhejiang branch’s Industrial Carbon Preferential Loans. These are offered to enterprises currently operating in a low-carbon way or who want to upgrade to carbon-reducing technologies. Carbon efficiency benchmarking grades for these enterprises are worked into each loan recipient’s credit model. During 2021, the bank made Industrial Carbon Preferential Loans to 40 enterprises, with a total value of 600 million renminbi (about $89.5 million). The bank’s role in sustainable project finance appears under its global award in that category.
BANK OF THE PHILIPPINE ISLANDS
Financial Leadership in Sustaining Communities
The Bank of the Philippine Islands (BPI) is committed to financing projects that align with the UN’s Sustainable Development Goals (SDGs). From 2020 to 2021, the bank’s SDG portfolio has grown 11.5%, from 538 billion to 600 billion Philippine pesos (about $9.8 billion to $11 billion).
The bank helps sustain communities through its BPI Direct BanKo arm. Focusing on microfinance, Direct BanKo helped thousands of self-employed Filipinos and microentrepreneurs. It offers simple, affordable financing to help people grow their businesses. With a physical presence in 74 of the Philippines’ 81 provinces, Direct BanKo disbursed 9 billion pesos in microbusiness loans to more than 200,000 people.
CHINA MERCHANTS BANK
Outstanding Leadership in Sustainability Transparency
In October, China Merchants Bank posted its Environmental Information Disclosure Report on its public website. It is the first national bank in China to publish such a report at the corporate level. The report covers carbon-emissions reduction generated by the bank’s credit activities and discusses its response to climate and environmental risks. Plans for a separate report on loans for carbon reduction are also in the works.
These publications are the bank’s latest efforts in the field of green transparency. In 2020, it published its Green, Social and Sustainability Bond Framework. As part of that framework, the bank publishes green credit policies, credit policies for energy conservation and environmental protection, policies for new-energy vehicles, purchasing and procurement regulations and other reports.
CTBC
Outstanding Leadership in Sustainable Infrastructure Finance
Taiwan’s CTBC recently served as the local financial adviser for two large energy/utility companies—Orsted and CIP—for their Taiwan offshore wind projects. CIP’s Zhong Neng project will provide approximately 300,000 Taiwanese households with clean energy. Orsted’s Greater Changhua offshore wind projects are being developed on four sites in the Taiwan Strait, from 22 to 37 miles off the coast. Together, the sites will power an estimated 2.8 million Taiwanese households.
ICBC
Outstanding Sustainable Financing in Emerging Markets
ICBC is serving as the commercial facility agent for a loan funding the 700 MW concentrated solar power project being built by Noor Energy for the Dubai Electricity and Water Authority. The project, developed in the Saih Al-Dahal region about 31 miles south of Dubai, will consist of one 100 MW tower plant along with three 200 MW parabolic trough plants. Built over about 30 square miles, it will be the single largest concentrated solar project in the world. —LS
|
REGIONAL WINNERS: CENTRAL & EASTERN EUROPE
|
|---|
RAIFFEISEN BANK INTERNATIONAL
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Green Bonds
Outstanding Leadership in Sustainable Bonds
Raiffeisen Bank International (RBI) again dominates Central and Eastern Europe (CEE), with wins in three categories, including overall honors. It was the largest green bond issuer in CEE and ranked first in sustainable bonds—a combination of green and social bonds—measured by both volume and number of transactions in Austria and CEE in 2021, according to Bloomberg’s league tables.
In 2021, RBI rolled out green bond programs to many of its subsidiary banks in Eastern Europe, including Tatra banka in Slovakia, Raiffeisen Bank in Romania, and Raiffeisenbank in the Czech Republic. Total green bond volume in CEE was nearly €1 billion. The subsidiary banks will use the issuances’ proceeds mainly for financing projects in the areas of green buildings, renewable energy, energy efficiency, clean transportation, water and wastewater management or agriculture and forestry. RBI also last year arranged the first sustainability-linked retail bond in the euro market, for UBM Development, a real estate development firm.
AKBANK
Outstanding Leadership in Social Bonds
Outstanding Leadership in Sustainable Project Finance
Akbank grew sustainable finance into a significant part of its overall bond business. In 2021, 41% of the Turkish bank’s foreign borrowings were ESG-related, up from 15% in 2020. Meanwhile, in September 2021, Akbank began issuing social bonds, including Turkey’s first domestic social bond. These bonds total 595 million Turkish lira (about $34.3 million) instrument designed to promote “good health and well-being.” More than 300 private banking customers invested in the bonds.
On the project finance side, Akbank committed to provide €30 million out of €200 million in 2021 for Turkey’s first green loan agreement in the infrastructure sector: the Bandırma-Osmaneli Railway, a 125-mile-long high-speed train project.
EBRD
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Outstanding Sustainable Financing in Emerging Markets
Outstanding Leadership in Sustainable Finance by a Multilateral Institution
The EBRD (European Bank for Reconstruction and Development) has been a leading institutional investor in Turkey since 2009, and it invested over €16 billion in the country through 373 projects to date, primarily in the private sector. Recently, it has been supporting Turkey’s transition to an environmentally sustainable, low-carbon and climate-resilient economy through a new Green Economy Financing Facility consisting of €500 million in financing from EBRD and concessional financing and grants from the Clean Technology Fund and the Turkey–EBRD Cooperation Fund.
The multilateral institution also engages in sustainable finance projects over a wide swath of emerging markets in Africa and CEE. In the past year, for instance, it helped Morocco transition to a green economy, assisted Bank of Africa in developing a green sustainable finance framework and aided the Electricity Network of Armenia in reducing its annual carbon dioxide (CO2) emissions.
CSOB
Outstanding Leadership in ESG-Related Loans
Financial Leadership in Sustaining Communities
Outstanding Leadership in Sustainability Transparency
CSOB, the largest bank in the Czech Republic, is determined to lead by example in the sustainability sphere. For instance, its regional HQ building, which opened in 2021 in Hradec Králové, about 50 miles outside of Prague, was designed with 108 boreholes—each reaching a depth of about 656 feet—providing both heating and cooling, a potent example to the surrounding community of the viability of renewable energy.
Elsewhere, green loans meeting EU taxonomy guidelines reached 3.2 billion Czech koruna (about $137 million) in 2021; there were none the previous year. The bank also completed its first euro-denominated corporate green bond mandate (worth €1 billion) in 2021 for CTP, the CEE’s largest logistics property owner-developer.
ERSTE GROUP
Outstanding Leadership in Sustainable Infrastructure Finance
Shifting freight transport from road to rail is a good way to reduce CO2 emissions, and one of the EU’s goals is to raise the share of rail freight to 30% from its current 18%. Austria’s Erste Group is doing its part to help meet this target with its rolling stock asset financing in Slovakia—committing more than €200 million in 2021, enabling the purchase of more than 50 new electric locomotives in that country. Recently, Erste Group’s Slovenska sporitelna bank acted as the sole underwriter in financing an additional 40 electric locomotives to eventually replace many hundreds of polluting diesel vehicles on the road. —AS
|
REGIONAL WINNERS: LATIN AMERICA
|
|---|
BTG PACTUAL
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Green Bonds
Outstanding Leadership in Sustainable Bonds
Outstanding Leadership in Sustainability Transparency
BTG Pactual’s growing commitment to ESG-related offerings can be summed up this way: From 2016 to 2021, the bank was involved in 10 ESG-related bond issuances, totaling $2.5 billion. In 2021 alone, its bond value jumped to $5.1 billion. BTG Pactual’s regional award for outstanding leadership in sustainable finance is based on this work in green bonds and sustainable bonds, along with its commitment to transparency.
The bank published its Green, Social and Sustainable Financing Framework in October 2020. A year later, it updated and shared this framework. It also publishes green financing reports; an annual review of green, social and sustainable financing; and other documents aimed at transparency.
These reports chart some significant accomplishments. Among 2021 bond issuances was the bank’s $500 million green bond, the first ever issued by a Brazilian financial institution in public markets. The bond will fund companies working in the fields of biofuels, solar power, wind power, water conservation and wastewater management. For example, BRK Ambiental—one of the largest private sanitation companies in Brazil—will use bond proceeds to provide sewage collection and treatment for roughly 122,000 people and to treat the water supplies for 126,000 people. In addition to improving sanitation, this project has the ancillary benefit of cleaning the Uruguay River, into which most of this sewage flows. A cleaner river will enable a new fishing industry in the region.
The bond is just part of the bank’s effort to help clients adopt more-sustainable business practices. BTG Pactual created an entire division focused on sustainable investing, working to turn BTG Pactual into a hub connecting global investors to sustainability opportunities in Latin America. The bank works hard to structure new business opportunities that generate strong long-term financial, environmental and social value for stakeholders.
BBVA
Outstanding Leadership in Social Bonds
In March, BBVA Mexico underwrote the nation’s first gender social bond, issued by IDB Invest and totaling $125 million. Funds raised will finance projects aimed at promoting gender equality and empowerment of Mexican women.
This is not BBVA’s only activity in the field of social equality. BBVA has committed to contributing €550 million to community initiatives between 2021 and 2025. These initiatives are designed to reduce financial inequality and promote entrepreneurship, improve educational opportunities, and support research and culture. As part of this commitment, BBVA has pledged to support 5 million entrepreneurs, provide financial education and literacy to 1 million people, and improve the education of 3 million people.
BANCO DAVIVIENDA
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Colombia’s Banco Davivienda issued a $150 million bond to finance projects related to sustainable construction, cleaner manufacturing, energy efficiency and the construction of clean energy plants (solar, photovoltaic, wind, biomass and hydraulic).
BANRESERVAS
Outstanding Leadership in Transition/Sustainability-Linked Loans
To support the Dominican Republic’s goal of increasing renewable energy generation, Banreservas structured a financing deal for $62.5 million. It will fund the construction, installation and operation of a photovoltaic power plant in La Yaguada del Sur. Expected to be one of the country’s largest solar farms, it will generate more than 122 GWh of solar power per year, save more than 60,000 tons of CO2 emissions annually and create more than 400 jobs.
PRODUBANCO
Outstanding Leadership in ESG-Related Loans
Financial Leadership in Sustaining Communities
In Ecuador, Produbanco is making strides in the fields of ESG-related loans and in financing to help sustain communities.
Small-business support and female empowerment are important aspects of any ESG initiative. Produbanco provides loans to both small and female-led businesses. At the time of this writing, $112 million of its loan portfolio consists of loans to women-led companies with net sales of less than $5 million per year.
Produbanco is helping to create sustainable communities by offering lines of credit for the purchase of sustainable housing. Special mortgage and financing deals are provided to people seeking to buy an environmentally friendly home, and to developers building with the environment in mind—particularly when it comes to conservation of energy and water.
BAC CREDOMATIC
Outstanding Leadership in Sustainable Infrastructure Finance
BAC Credomatic strives to improve the social and structural infrastructure of the six Latin American countries it serves. As part of this effort, it is financing EV charging stations in Costa Rica and Panama, carbon reduction projects in Guatemala and solar panel projects in Honduras.
BANCO BRADESCO
Outstanding Leadership in Sustainable Project Finance
Renewable energy, public health, and sustainable farming: Banco Bradesco finances projects in all these categories.
Bradesco is one of Brazil’s most significant financial agents in the renewable energy sector. In 2021 alone, Bradesco BBI, the organization’s investment bank, advised on 24 projects focused on the generation, transmission, and distribution of energy from renewable sources. Projects were funded for a total of more than 9.2 billion Brazilian reais (about $1.8 billion).
Significant activities include the issuance of R$1 billion in debentures for the health care sector. These debentures, supporting companies that provide quality diagnostic and clinical services, will expand access to health care for low-income Brazilians. The initiative also seeks to reduce biological waste.
The bank also supports sustainable farming in the Amazon region. In 2021, it disbursed R$588 million for sustainable crops in that region. These crops include cocoa, açaí, cassava, nuts, oils and fish. As part of this effort, Banco Bradesco works with partners to teach agricultural workers about sustainability.
SocGen received a top AAA rating in 2021 from environmental, social and governance (ESG) rating firm MSCI, placing it in the top 3% among the 190 banks in its peer group. It also made the top 1% among 4,944 companies rated by Moody’s ESG 2021 (formerly Vigeo Eiris). —Andrew Singer
BANCO PICHINCHA
Outstanding Sustainable Financing in Emerging Markets
Banco Pichincha’s broad and significant ESG programs in Ecuador have earned it an award for outstanding sustainable finance in emerging markets. Currently, loans with a social and environmental focus represent more than 31% of the bank’s total loan portfolio.
Operating under a robust ESG policy that states its principles for social responsibility and sustainability, Banco Pichincha has specific goals it is striving to meet by 2025. These include mobilizing $500 million in sustainable finance efforts. It also plans to become carbon neutral in its own operations and increase to 499,000 the number of micro and small businesses served by digital financial services.
In alignment with those goals, the company placed $191.5 million in bio loans in 2021, representing 3% of its total loan portfolio. These loans finance environmentally friendly cars, cleaner production methods, green housing, sustainable construction and sustainable agriculture methods.
Gender inclusion is also important to the bank. Banco Pichincha launched the first social gender bond in the Ecuadorian market, totaling $100 million. The bond aims to promote innovative financing channels to help close the gender-based financing gap. The bank also has loan programs targeting female-led micro, small and midsize enterprises (MSMEs). Thanks to these programs, the bank now has more than 19,000 women led MSME clients. —LS
|
REGIONAL WINNERS: MIDDLE EAST
|
|---|
QATAR NATIONAL BANK
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Social Bonds
Outstanding Leadership in Sustainable Bonds
Qatar National Bank takes the regional award for outstanding leadership in sustainable finance for its work in social bonds and sustainable bonds.
Under the bank’s sustainability framework, green bonds are issued for green buildings, renewable energy projects, clean transportation, environmentally sustainable land management, sustainable water and wastewater management, and pollution prevention and control. Social bonds are issued for green infrastructure (providing sewers, sanitation, clean drinking water, transportation and energy), housing, and socioeconomic advancement, among other projects.
In alignment with the bank’s sustainability framework, Qatar National Bank has issued its first green bond, which totals $50 million. It has borrowed $685 million for sustainability-linked syndicated loan facilities. It issued a sustainability-linked project finance loan with a pricing plan indexed to defined sustainability criteria. The bank also borrowed $50 million to provide support to private sub-borrowers who are developing green energy and water management projects.
CIB
Outstanding Leadership in Green Bonds
Outstanding Leadership in ESG-Related Loans
Outstanding Leadership in Sustainable Infrastructure Finance
CIB (Commercial International Bank) excels in the fields of green bonds, ESG-related loans and sustainable infrastructure finance.
At the end of June 2021, CIB opened subscription for the first green bond in Egypt. Valued at $100 million, this bond is targeted toward sustainable solutions to climate change, particularly industrial energy efficiency and green building.
In the realms of ESG-related loans and sustainable infrastructure, CIB has several offerings. It launched a green finance product, called the CIB Green Credit Line, to support corporate customers who want to achieve economic growth through environmental projects and practices. The loan offers preferential interest rates for borrowers embarking on energy efficiency and renewable energy projects, and for projects that otherwise have a positive impact on the environment. CIB’s retail Solar Loan offers competitive rates and a flexible repayment plan for the purchase and installation of solar panels. It has joined the Egyptian Pollution Abatement Project, supporting corporate pollution abatement, energy efficiency, industrial waste management, cleaner production and resource efficiency.
FIRST ABU DHABI BANK
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Outstanding Leadership in Transition/Sustainability-Linked Loans
Financial Leadership in Sustaining Communities
Outstanding Leadership in Sustainable Project Finance
First Abu Dhabi Bank takes the awards for outstanding leadership in sustaining communities, for its work in sustainable project finance, and for transition/sustainability-linked bonds and loans. Its significant activities in 2021 include serving as joint bookrunner for four green/sustainable bonds; as global coordinator and bookrunner for Egypt’s $3 billion facility to support clean transportation, renewable energy, climate change adaptation and the like; and as joint ESG structuring bank, joint ESG coordinator and joint bookrunner for a $1.2 billion transition loan for Etihad Airways—said to be the first sustainability-linked ESG loan in global aviation. The loan will help Etihad reduce carbon emission from its passenger fleet and support upskilling Emirati women for careers in the aviation sector. In addition, the bank is helping to develop sustaining communities through a lending program in the UK. An initial £330 million (about $405 million), granted in 2019, provided financial support for the development of affordable housing. In 2021, First Abu Dhabi Bank increased its commitment to this program by more than £272 million.
NATIONAL BANK OF BAHRAIN
Outstanding Leadership in Sustainability Transparency
In 2021, National Bank of Bahrain wrote and published its sustainability framework. Its “seven pillars” are economic growth, responsible banking, serving the bank’s customers, nurturing its workforce, community investment, preserving natural resources, and ethical behavior and governance. The bank also committed to significantly improving its own environmental performance, taking action to mitigate climate change and minimize its environmental impact. Various reports will track its progress toward those goals. It has also published its sustainability policy, environmental policy and global credit policy.
MISR CAPITAL
Outstanding Sustainable Financing in Emerging Markets
Cairo’s MISR Capital is participating in two sustainability-linked private equity funds to serve emerging markets. The first, in partnership with Elevate Private Equity, is a $380 million fund seeking to expand health care in the Middle East and Africa.” Lighthouse Education is a private equity fund of more than $93 million, aimed at addressing educational inequities among Egypt’s youth. —LS
|
REGIONAL WINNERS: NORTH AMERICA
|
|---|
BANK OF AMERICA
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in ESG-Related Loans
Outstanding Leadership in Sustainable Project Finance
In 2021, Bank of America announced its goal of mobilizing and deploying $1.5 trillion in sustainable finance capital by 2030. Out of that, $1 trillion is dedicated to the transition to a low-carbon economy. As part of this commitment, the bank issued its second Equality Progress Sustainability Bond, each for $2 billion. Designed to “advance equality and economic opportunity for historically marginalized populations,” this second bond builds on the first, issued in 2020, broadening to include women, Asian Americans, Pacific Islanders, and Indigenous peoples. BofA Securities acted as sole bookrunner and sustainability structuring agent for this offering. The bank also originated more than $400 million in loans and investments to community development financial institutions, which finance affordable housing, economic development and other community services. Bank of America has lent more than $2 billion to these institutions in all and provided a host of tax credit equity investments and real estate development solutions. For 2021, the bank mobilized and deployed approximately $250 billion of capital aligned with the UN SDGs, including $155 billion for financing environmental transition and $95 billion for inclusive social development.
Looking forward, the bank has begun to focus on environmental technologies beyond wind and solar. It made its first investment in desalination and supported the development of sustainable aviation fuel. In part because of these activities, Bank of America was one of seven companies (and the only financial institution) named as an anchor partner for Breakthrough Energy Catalyst. This program, part of the Breakthrough Energy network founded by Bill Gates, is forging a new model for public-private sector partnerships to build a net-zero economy.
CIBC
Outstanding Leadership in Green Bonds
Outstanding Leadership in Transition/Sustainability-Linked Bonds
CIBC (Canadian Imperial Bank of Commerce) plans to mobilize $300 billion in sustainable finance by 2030. It’s a quarter of the way there, having mobilized $77 billion thus far—$34.9 billion in 2021 alone.
Green bonds and sustainability-linked loans are a big part of the mix. For several years, CIBC has been involved in the green bond market; held a portfolio of green bonds; and worked with clients to originate, structure, and execute ESG bonds. Transition/sustainability-linked loans, meanwhile, provide customers with funds to help meet ESG performance targets, aligned with either customers’ internal key performance indicators (KPIs) or third-party ESG-risk ratings.
CIBC also joined forces with Itaú Unibanco, National Australia Bank and NatWest Group for Project Carbon to create technology platform Carbonplace. Carbonplace strives to create a book of record for ownership of voluntary carbon credits, thereby enabling clear and consistent pricing, standards and trades in the voluntary carbon credit market.
SCOTIABANK
Outstanding Leadership in Social Bonds
Outstanding Leadership in Sustainable Bonds
Outstanding Leadership in Transition/Sustainability-Linked Loans
Outstanding Leadership in Sustainability Transparency
Scotiabank served as joint debt placement and joint sustainability structuring adviser for the HPC Housing Investment Corporation’s 40 million Canadian dollar (about US$31 million) social bond, the first of its type in Canada. Earmarked for affordable housing, it will help fund a mixed-use redevelopment project in Edmonton, Alberta. The 240-unit housing project will include 192 affordable units and 24 handicapped-accessible units.
In the sustainability market, Scotiabank acted as co-structuring adviser and joint bookrunner for Telus’ CA$750 million bond, the first sustainability-linked bond in Canada and believed to be the first for a wireless telecommunications company. The bank served in the same capacities for a bond floated for Enbridge, a gas and oil pipeline company. The bond will help Enbridge undertake projects to reduce its GHG emissions and increase racial, ethnic and gender diversity in the workforce.
CITI
Financial Leadership in Sustaining Communities
Outstanding Leadership in Sustainable Infrastructure Finance
Outstanding Sustainable Financing in Emerging Markets
To bolster emerging markets, in 2021 Citi partnered with the United States International Development Finance Corporation and the Japan International Cooperation Agency to provide $70 million to Banco Compartamos, the largest microfinance institution in Mexico. Compartamos is using those funds to support more than 135,000 small businesses, approximately 90% of them women owned. This is important because women represent 19% of the entrepreneurs in Mexico, yet they typically have few opportunities to access financial investments for their businesses. A portion of the loan is earmarked to providing micro loans to those working in less developed regions of Mexico, including Chiapas, Oaxaca, Guerrero and Puebla.
Citi’s work in sustaining communities has included acting as sole structurer and arranger for a first-of-its-kind $100 million bond transaction from the World Bank’s International Bank for Reconstruction and Development. The bond will allow Unicef to access capital markets to fund its work with children. Projects to be funded include Covid-19 resilience programs around the world, tackling the health and socioeconomic impacts of the pandemic. A line of credit provided to mPharma will support expansion of its health care network across sub-Saharan Africa, helping to finance small pharmacies and clinics in that region. Thanks in part to the line of credit from Citi in partnership with other organizations, mPharma will be able to serve more than 2 million patients in a number of African nations. —LS
|
REGIONAL WINNERS: WESTERN EUROPE
|
|---|
SOCIETE GENERALE
Outstanding Leadership in Sustainable Finance
Outstanding Leadership in Transition/Sustainability-Linked Bonds
Societe Generale has been a global pacesetter in sustainable finance, but it also stands out in its native Western Europe. In early 2021, Soc Gen acted as senior mandated lead arranger in the €2.1 billion nonrecourse financing for the 448 MW Courseulles-sur-Mer offshore wind project more than six miles from the coast of Normandy, France. The project involves 64 wind turbines, occupying a total surface area of approximately 17 square miles.
SocGen has also been at the forefront of SLBs, notching several firsts, including the role of joint bookrunner in the largest SLB ever, a multitranche $4 billion for Italian energy producer Enel in July 2021. It was also joint global coordinator and ESG structurer for the second-ever sustainability-linked convertible bond, Edenred’s €400 million issuance in June 2021.
BBVA
Outstanding Leadership in Green Bonds
Financial Leadership in Sustaining Communities
In September 2021, BBVA was lead manager and green structuring adviser for the Kingdom of Spain’s first green bond, a €5 billion, 20-year issue. The bond received the highest rating ever given to a European sovereign by second-party opinion provider Vigeo Eiris. Earlier in the year, Spanish energy firm Iberdrola closed a €2 billion dual-tranche green hybrid bond, the largest corporate transaction of its sort ever priced. BBVA acted as global coordinator and green structuring bank.
In October 2021, BBVA announced its Community Commitment, a program that will allocate €550 million to social initiatives that spur inclusive growth in the countries where BBVA operates. The program is expected to provide support to 5 million entrepreneurs and help to educate another 3 million individuals. The bank aims to originate more than €7 billion in microloans too. Overall, as many as 100 million people could benefit from these programs.
STANDARD CHARTERED
Outstanding Leadership in Social Bonds
Outstanding Sustainable Financing in Emerging Markets
Standard Chartered’s social bond projects span the world—StanChart was Global Finance’s global honoree in this category, too—but closer to home, it supported French multinational electric utility EDF in the issuance of the world’s first corporate social hybrid bond in August 2021. Proceeds will fund social projects aimed at generating local employment opportunities with an emphasis on SMEs that supply EDF’s European activities.
The bank’s activities in emerging markets account for 70% of its sustainable finance assets, and it plans to mobilize $300 billion in green and transition finance by 2030 to help clients reach their 2050 net-zero targets. In September, StanChart was joint lead manager and joint bookrunner for the first green bond issued by a sovereign, supranational agency in the Middle East and North Africa region—the Arab Petroleum Investments Corporation’s $750 million issuance.
SANTANDER
Outstanding Leadership in Sustainable Bonds
Outstanding Leadership in Transition/Sustainability-Linked Loans
Outstanding Leadership in Sustainable Infrastructure Finance
Santander excelled in both sustainable bonds and loans in 2021—with exemplary infrastructure finance efforts thrown in for good measure. The Spanish bank was joint lead manager with HSBC for Isle of Man Treasury’s 30-year £400 million sustainable bond issuance in September 2021. There was strong institutional interest in the issuance, which that government says “demonstrates that investors recognize the Isle of Man’s fiscal strength and, through our new Sustainable Financing Framework, the government’s commitment to protecting and enhancing the environment in the Isle of Man as well as investing in the community for the long term.” Projects will be funded in such areas as clean transportation, energy efficiency, affordable housing, education and health care.
In the loan arena, Santander acted as joint sustainability coordinator for Anheuser-Busch InBev’s $10.1 billion sustainability-linked revolving credit facility (RCF), which replaced its existing $9 billion RCF. It was one of the largest sustainability linked RCFs ever, and the first among publicly listed companies in the alcohol beverage sector. AB InBev has four KPIs covering: water efficiency in the breweries, GHG emissions, PET (polyethylene terephthalate) recycled content in packaging and energy from renewable sources.
Finally, in infrastructure, Santander was mandated lead arranger and hedge provider in the first large-scale EV-charging infrastructure transaction in Europe financed under the project finance format. The €138 million raised by the issue will fund construction and operation of over 2,000 EV charge points across more than 200 Carrefour superstores in France. Because of the project’s positive environmental impact, it obtained the Green Loan label.
NATIXIS
Outstanding Leadership in ESG-Related Loans
Natixis was seventh globally in green-loan volume by bookrunner, with 47 deals totaling $10.4 billion, according to Dealogic. The French bank’s 2021 activities included an $835 million construction bridge loan in October for TotalEnergies’ Danish Fields solar project in Texas, for which Natixis acted as syndication agent and green loan coordinator, and Calpine’s $1.75 billion refinancing of Geysers Power’s geothermal plants in November, with the bank acting as fronting bank, hedge provider and green loan coordinator.
LGT
Outstanding Leadership in Sustainability Transparency
Nearly 19 years ago, LGT started to embed ESG clauses in its investment programs; and 11 years back, it began to set concrete sustainability goals. Currently, LGT tracks the ESG performance of around 9,800 companies operating in 200 countries and translates this data into its own sustainability rating. It displays its LGT Sustainability Rating at a single position level in clients’ statement of assets—a single column headed by “percentage of portfolio sustainability”—and an LGT sustainability rating at the portfolio level and ESG scores and CO2 footprint of single holdings.
ING
Outstanding Leadership in Sustainable Project Finance
ING acted as sole lender in a June 2021 financing transaction enabling electric-bike subscription service E-bike to Go to expand its e-bike portfolio with 5,000 new e-bikes and grow its service throughout the Netherlands and beyond. Prior to this, ING developed a framework to assess finance structures, considering the sustainable and circular aspects of the transaction as well as the products-as-a-service business model, the market and the financial parameters. —AS
