The European Bank for Reconstruction and Development (EBRD) has issued a US$ 250 million bond, aimed specifically at institutional investors seeking to support environmentally sustainable projects.
The Bank will use the proceeds from the bond for investment in its Green Project Portfolio. This portfolio comprises financing for such areas as energy efficiency, clean energy, water management, waste management, sustainable living, environmental services and sustainable public transport.
Morgan Stanley and Skandinaviska Enskilda Banken (SEB) were joint lead managers in the issue.
The EBRD first started issuing green bonds in 2010, and its portfolios of green projects currently comprise 261 investments, with an average term of 10 years, and worth a total of €2.7 billion based on operating assets. The portfolio represents a selected number of projects, in respect of which all, or substantially all, amounts disbursed are directed at environmental goals.
The Bank places a very high priority on investments in sustainable energy, financing energy efficiency projects as well as making investments in renewable energy, in a drive to boost competitiveness of economies in the region and to mitigate the impact of climate change.
It has invested over €11 billion in over 600 projects under its Sustainable Energy Initiative (SEI) that was launched in 2006.
Earlier in 2013, the SEI was expanded into the Sustainable Resource Initiative, which promotes efficiency in water and other materials, such as waste.
This latest transaction was targeted at socially responsible investors who place a high priority on ethical and environmentally and socially conscious funding.
Fourteen investors participated in the bond; 51 per cent of the funds were placed with US accounts, 31 per cent with European accounts, and eighteen per cent with Asian accounts. The sector allocation was as follows: 64 per cent to pension funds, 18 per cent to central banks, 12 per cent to asset managers, four per cent to state-related investors, and less than one per cent to bank treasuries and foundations.
Issuer: European Bank for Reconstruction and Development (EBRD)
Amount: US$ 250 million
Settlement date: 17 September 2013
Maturity date: 10 April 2018
Re-offer price: 99.453%
Issue yield: 1.75%
Denomination: US$ 1,000 / US$ 1,000
Listing: London Stock Exchange
Lead Manager: Morgan Stanley / Skandinaviska Enskilda Banken AB
Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,200 offices in 43 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.
SEB is a leading Nordic financial services group. As a relationship bank, SEB in Sweden and the Baltic countries offers financial advice and a wide range of other financial services. In Denmark, Finland, Norway and Germany the bank's operations have a strong focus on corporate and investment banking based on a full-service offering to corporate and institutional clients. The international nature of SEB's business is reflected in its presence in some 20 countries worldwide. On June 30, 2013, the Group's total assets amounted to SEK 2,596 billion while its assets under management totalled SEK 1,387 billion. The Group has about 16,000 employees. Read more about SEB at www.sebgroup.com