London Stock Exchange (LSE) has announced the listing of the first-ever green bond from the Gulf region, issued by National Bank of Abu Dhabi (NBAD).
The five-year dated green bond raised $587 million, paying a three per cent semi-annual coupon. NBAD will use the proceeds to invest in projects which contribute to the fight against climate change and to protect natural resources. Eligible projects are identified in NBAD’s Green Bond Framework, which was drafted in accordance with the Green Bond Principles, a global set of guidelines framing the issuance of green bonds.
Commenting on the listing, Darko Hajdukovic, Head of Fixed Income, Funds & Analytics, London Stock Exchange, said, “London Stock Exchange is proud to be the partner of choice for National Bank of Abu Dhabi in its historic green bond listing, another world-first for green finance. NBAD is spearheading the potential to unlock and promote green finance across the Middle East region. London Stock Exchange is a recognised world leader in green, sustainable and debt financing, supporting issuers from Abu Dhabi to China, Finland to India in accessing international investment capital.
There is an undeniable shift in momentum in green and sustainable financing across the world and we believe there is an opportunity for us to be the funding partner of choice for the wider Middle East region. London Stock Exchange is uniquely placed with its extensive product offering and expertise to support issuers and inventors in this green funding revolution.”
The milestone bond listing for NBAD and the Gulf region follows several high profile bond issuances by supranational institutions, municipals and private companies on the LSE over the past 12 months, cementing the exchange’s position as a leading global venue for debt and sustainable fundraising.
Together, with the active and fast-growing community of Middle Eastern issuers on its markets, London Stock Exchange is ideally suited to support Abu Dhabi’s and the wider region’s growth ambitions:
- 37 Middle East and North Africa (MENA) companies with a combined market.
- Capitalisation of $66 billion are listed in London.
- In 2017 so far, seven international sovereign bonds from the MENA region, raising a total amount of $14.4 billion, have listed in London
- On 20 March, Kuwait entered the international debt markets for the first time, issuing an $8 billion Eurobond on London Stock Exchange. The dual tranche bond was 3.4 times oversubscribed.
- On 31 January, the Arab Republic of Egypt issued a triple tranche $4 billion Eurobond in London, the largest ever sovereign deal from Africa. The issue was increased from $2.5 billion due to exceptional investor demand.
Recent London Stock Exchange Group (LSEG) green finance initiatives and milestones:
- LSEG is home to a number of global first green bond issuances from Bank of China and Agricultural Bank of China, India’s Axis Bank, Development Bank of Japan and the IFC, a member of the World Bank Group.
- In 2016, 14 new green bonds in 5 different currencies raised over $5 billion; in total 42 green bonds are listed on London Stock Exchange which have raised $11.2 billion.
- On 7 November 2016, FTSE Russell, the global index provider, announced the creation of a new index, the FTSE All-World Ex CW Climate Balanced Factor Index, the first to combine a smart beta factor approach alongside climate change considerations.
- The index has been chosen by Legal & General Investment Management for its new Future World Fund, which HSBC Bank UK Pension Scheme has selected for its equity default option, worth £1.85 billion, in its DC scheme.
- There are 35 ‘green companies’ which have raised $10 billion combined in London including 14 renewable investment funds.
LSEG has been supporting investors and issuers in the transition to a low-carbon and sustainable economy for over a decade, developing innovative products and services in close collaboration with the market. Its comprehensive sustainable finance offering is focused on green financing for issuers (both debt and equity), indexing and analytics. London’s markets are home to a diversified portfolio of green bonds, ETFs, renewable investment funds and corporates whose business models encompass alternative energy.
FTSE Russell, the global index leader, has long been a pioneer in the development of benchmarking tools enabling investors to integrate ESG factors in their portfolios and to track the increasing shift towards a green economy.
LSEG joined the UN’s Sustainable Stock Exchanges initiative as a Partner Exchange in 2014 and has also signed The Paris Pledge for Action.
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