Access Bank Plc. said on Monday that a five-year Fixed Rate Senior Unsecured N15 billion Green Bond, the first climate bond to be issued in Africa, had been fully subscribed.
The bank’s Group Managing Director, Mr. Herbert Wigwe, stated this at the bond-signing ceremony in Lagos.
Green bond is a bond specifically earmarked to be used for climate and environmental projects. It is typically asset-linked and backed by the issuer’s balance sheet, and is also referred to as climate bond.
Wigwe said the Green Bond offer was achieved by way of Book Building, a systematic process of generating, capturing, and recording investor demand for shares during an Initial Public Offering (IPO), or other securities during their issuance process.
This is in order to support efficient price discovery.
He said the bond, priced at a coupon of 15.5 per cent, had participation from a wide range of asset managers and Pension Fund Administrators (PFAs).
Wigwe said the bank supported the global climate change mitigation and adaptation agenda and was seeking to promote responsible green lending globally.
According to him, the Green Bond issuance demonstrates the bank’s commitment to sustainable operational practices, being a pioneer operator both in domestic and international capital markets.
He added that the bank viewed the global drive for responsible and sustainable green financing as an opportunity to raise capital for the creation of assets through climate change financing.
Wigwe maintained that the bank has a strong track record of deploying environmental and social risk management tools as well as working closely with local and international agencies to deliver a greener outcome from investing activities. “With our pace-setting experience in the mainstreaming of sustainability in our business operations, we are confident that this issue will further help in supporting environmentally friendly investors to meet their investment objectives while simultaneously supporting the bank’s customers towards realising growth opportunities in fast-developing low carbon economy,” Wigwe said.
He noted that the new funding would be directed toward financing new loans and refinancing existing loans in accordance with the bank’s Green Bond Framework, and support projects directed at flood defense, solar generation facilities, and agriculture.