Amount: EUR 500 million
Format: Global MTN programme
Settlement Date: 17th October 2019
Coupon: 0% annual
Maturity Date: 17th October 2024
Issue Price: 102.306%
Spread: -10bps versus USD Mid Swaps
+25.4bps over OBL 0.00% due October 2024
Interest Dates: 17th October, first payment on 17th October 2020
Listing: London Stock Exchange’s Regulated Market
Joint Lead Managers: Barclays, BofA Merrill Lynch, Citibank and HSBC
On Thursday 10th October 2019, the European Bank for Reconstruction and Development (EBRD), rated Aaa (Moody’s) / AAA (S&P) / AAA (Fitch), launched and priced its inaugural Green Transition Bond, an EUR 500 million 5-year at MS-10bps.
EBRD’s new framework provides an opportunity to finance investments in key sectors of the economy that today are highly dependant on the use of fossil fuels, thereby enabling the transition to low carbon and resource efficient operations.
The proceeds from the transaction will be earmarked to support environmentally and socially sustainable projects, which currently comprises investments in the following 3 areas:
- Energy Efficiency
- Resource Efficiency (including circular economy adapted products)
- Sustainable Infrastructure (including low carbon transport, and green logistics)
The mandate for a new Green Transition Bond was announced to the market on the 19th October 2019 at 5pm London, with initial price thoughts of MS-10bps area. Books officially opened the following morning at 8am, with price guidance unchanged at MS-10bps. By 11.30am the order book was in excess of EUR400m and pricing set in line with the guidance for a EUR500m deal.
The transaction saw continued interest and the orderbook peaked at over EUR460m, with demand from 20 investors. Support from SRI investors was strong, accounting for 83% of allocations.
ERBD reached a broad audience of international investors. The bulk of demand came from the UK (55%), followed by EMEA (18%), Asia (15%) and the Americas (12%).
The main investor category was banks (59%), with strong support also coming from asset managers (26%) and central banks and official institutions (15%).
This transaction was joint-led by Barclays, BofA Merrill Lynch, Citi and HSBC.