30 Aug 2024
NIB updates Green Bond Framework and retains ‘Dark Green’ rating from S&P
NIB is pleased to announce the release of its updated NIB Environmental Bond (NEB) framework, accompanied by a new Dark Green Second Opinion from S&P Global Ratings.
“The green transition and steering the Nordic-Baltic region towards a more resilient future remains top priority for NIB. With the update of our NIB Environmental Bond framework, NIB continues to facilitate investments that accelerate the sustainability agenda. We at NIB are committed to being at the forefront of the movement, fostering innovation and resilience through dedicated green financing,” says André Küüsvek, NIB President and CEO.
This update marks the third revision of NIB’s Use-of-Proceeds environmental bond framework since its inception. The previous iteration of the NEB framework was revised in December 2018, with a subsequent correction in October 2019.
Since launching its first NIB Environmental Bond in 2011, the bank has successfully issued 34 NEBs, totalling EUR 8.5 billion, which have funded a corresponding amount of environmental projects. NIB adopts a portfolio approach, allowing multiple bonds to finance a diversified portfolio of eligible projects. Going forward, NIB will cease to allocate funds to the existing legacy portfolio of financed projects, though it will maintain impact reporting until the maturity of the outstanding bonds. A new portfolio comprising new eligible projects will be created for NEBs issued under this updated framework.
Key enhancements to the framework include:
- Emphasising NIB’s Climate Strategy and targets.
- New allocation criteria that ensures that also the counterparty behind the project can demonstrate adequate ESG (Environmental, Social, and Governance) performance.
- Integrating assessments and alignments with the EU Taxonomy for sustainable activities.
- Aligning project categories with the Green Bond Principles (GBP), the EU Taxonomy, relevant Sustainable Development Goals (SDGs), and targets outlined in NIB’s Climate Strategy.
- Modifying the list of eligible categories as detailed below
| OLD NEB categories: | NEW NEB categories: |
| Renewable energy | Renewable energy |
| Clean transport solutions | Clean transportation |
| Water management and protection | Water management and protection |
| Green buildings | Green buildings |
| Energy efficiency | Sustainable fuel production and infrastructure |
| Transmission, distribution and storage systems | Climate change adaptation |
| Resources and waste management systems | Sustainable technology innovation, sustainable manufacturing and carbon capture storage |
The framework is aligned with the Green Bond Principles[1] and its four core components.
“We are already almost halfway in this critical decade leading to 2030 and global targets are approaching fast. By sharpening our categories, embedding further the EU Taxonomy technical requirements and aligning with our overarching Climate Strategy, the new framework allows us to further focus on what really matters and accelerate capital allocation towards green assets,” says Luca De Lorenzo, NIB Head of Sustainability and Mandate.
NIB has obtained a new Second Opinion from S&P Global Ratings for its revised NIB Environmental Bond framework. This updated framework has been awarded a ‘Dark Green’ rating, which is the highest environmental performance according to S&P’s evaluation criteria. Similarly, the previous version of the framework also garnered a ‘Dark Green’ rating from CICERO Shades of Green, reaffirming NIB’s consistent commitment to high environmental standards in its green financing initiatives.
“We are very proud to have our updated NIB Environmental Bond framework receive the ‘Dark Green’ rating from S&P Global Ratings, affirming our firm dedication to environmental excellence,” says Kim Skov Jensen, NIB CFO and Head of Treasury & Finance. “This recognition underscores the robustness of our approach to sustainable financing and our commitment to supporting projects that yield tangible environmental benefits”.
For further information, please contact
Jens Hellerup, Senior Director, Head of Funding & Investor Relations at +358 10 618 0340, jens.hellerup@nib.int
Luca De Lorenzo, Senior Director, Head of Sustainability & Mandate at at +358 10 618 0297, luca.delorenzo@nib.int
[1] 2021 edition of the Green Bond Principles (“GBP”) with June 2022 Appendix.