Abu Dhabi Commercial Bank today announced the completion of pricing for the first-ever green bond issuance, which will be issued on September 14, 2022, with the bank raising $500 million (AED 1.8 billion) to support financing sustainable initiatives and low-emissions projects.
The bonds were issued with a maturity of 5 years, with a margin of 115 basis points above the average treasury bond rates and an interest rate of 4.5%, and the issuance was covered by 3.8 times after attracting a wide range of local, regional and international investors, with the value of total orders amounting to over 1.9 Billion dollar. The strong demand from investors follows a round of investor meetings organized by the bank, which is tangible evidence of the high confidence in ADCB and its approach to managing risks and opportunities related to environmental, social and corporate governance.
The bank had adopted environmental, social and corporate governance practices in its corporate strategy, and followed a sustainability approach in line with the aspirations of the United Arab Emirates to build an inclusive, carbon-neutral economy.
The bank also confirmed its commitment by providing 35 billion dirhams of credit facilities for green finance by 2030, and to reach climate neutrality in the bank’s operational operations, in line with the aspirations of the UAE government to reach climate neutrality.
-
Alaa Erekat: Applying international best practices in the field of environmental and social governance
Alaa Erekat, Group CEO of ADCB, said: “The successful and first-of-its-kind issuance of green bonds by ADCB represents an important achievement and a significant step in the bank’s journey towards implementing international best practices in the field of environmental, social and corporate governance. This step also reflects the Bank’s conviction of the vital role played by major banks in supporting the transition towards a zero-emissions economy, and its firm commitment to support the goals of the UAE’s strategic initiative to achieve climate neutrality by 2050. We have adopted the Green Bond Framework with the aim of laying the foundations for a long strategy Term to support fundraising efforts for clean energy initiatives and various sustainable projects. We look forward to cooperating with our customers and all concerned parties to work together to achieve our future aspirations, build a better future and reach climate neutrality.”
Abu Dhabi Commercial Bank achieved this pricing of green bonds, backed by its strong credit ratings, most notably A and A-1 with a stable outlook from Standard & Poor’s and A+ and F1 with a stable outlook from Fitch. The bank also received an AA rating from MSCI’s Environmental, Social and Corporate Governance Index, and a medium risk rating from Socialites for its environmental, social and corporate governance risk rating.
The proceeds from the issuance of bonds are a key support for financing the low-emission economy, in line with the criteria set out in the framework. Eligible initiatives for green loans include projects or companies related to renewable energy, green buildings, sustainable water and wastewater treatment, sustainable transportation, energy efficiency and pollution control and management.
The framework is aligned with the United Nations Sustainable Development Goals and is based on the Green Bond Principles of the International Capital Markets Association. The framework is managed by a working group of officials in the Bank from various departments, who submit their reports to the Sustainability Committee of the Executive Management of the Bank.
In line with industry best practices, ADCB obtained an independent third-party opinion to validate the sustainability quality of the framework and its compliance with green bond principles.
#Abu #Dhabi #Commercial #issues #green #bonds #worth #billion #dirhams