NTMA signals commitment to Green Bond Issuance following publication of the Irish Sovereign Green Bond Framework
07 September 2018 - The National Treasury Management Agency (NTMA) announces plans to issue Ireland's first Green Bond in the coming months, subject to market conditions.
The announcement followed the publication today by the NTMA of the Irish Sovereign Green Bond (ISGB) Framework, which has been approved by Government. The publication of the ISGB Framework meets a necessary condition to issue a sovereign Green Bond.
The ISGB Framework sets out how proceeds from ISGB issuance will be allocated against eligible green projects, which primarily address climate change mitigation and adaptation, clean water and wastewater treatment, counter natural resources depletion and loss of biodiversity, and reduce air pollution. It also aligns green bond funding with State spending on green projects identified in the National Development Plan. The ISGB Framework also provides for the creation of a reporting mechanism for ISGBs.
The ISGB Framework has been reviewed independently by Sustainalytics, a global firm that specialises in environment, social and government research and ratings, which confirmed that the Framework is credible, impactful and aligns with the core components of the Green Bond Principles 2018[1]. Sustainalytics has provided a second party opinion on the ISGB Framework, which has also been published today. The opinion also recognises the potential of ISGBs to advance green finance, enabling capital to be directed towards investments in sustainable growth. The opinion can be found here. A copy is also available on the NTMA website along with the Framework.
Green Bonds remain a relatively new feature of the sovereign debt market. In the EU only France, Belgium and Poland have issued Green Bonds to date.
The NTMA intends to engage with potential ISGB investors on a targeted roadshow over the coming weeks.
Comment by the Minister for Finance and Public Expenditure & Reform, Paschal Donohoe TD:
"The Government's decision to approve the ISGB Framework clears the way for the NTMA to open up a new funding channel for climate change action, which is a top priority for Government, and specifically to target objectives set out in the National Development Plan and Project Ireland 2040 which articulate Ireland's ambitions in regard to building a sustainable, low-carbon society."
Comment by Frank O'Connor, NTMA Director of Funding and Debt Management:
"The NTMA's strategy is to expand our investor base by geography, investor type and product. The issuance of Green Bonds enables Ireland to access a new and growing pool of capital."
Notes to Editors
- The NTMA's plan to issue a Green Bond is the latest step it has taken to increase the range of debt instruments it offers to investors and optimise Ireland's position as a sovereign issuer. During 2017 the NTMA issued Ireland's first-ever Inflation-Linked Bond as part of this strategy.
- Two recognised Primary Dealers in Irish Government bonds, J.P. Morgan and HSBC France, are acting as structuring advisors to the NTMA on an initial ISGB issue.
- More information on Sustainalytics can be found here.
[1] Green Bond Principles, 2018 version ("GBP") published by the International Capital Market Association ("ICMA").