BayernLB

04-Feb-2021

BayernLB issues debut green benchmark bond with a volume of EUR 500 million

In January the Bank successfully placed its first green commercial paper

Munich - BayernLB has placed its first sustainable benchmark bond on the capital market with great success. The seven-year debut deal with a volume of EUR 500 million has a coupon of 0.125 percent and is rated A2/A- by Moody’s and Fitch rating agencies. The Bank will use the issue proceeds to fund solar and wind power projects as part of its sustainable lending portfolio.

The more than four-times oversubscribed green senior non-preferred bond met with considerable interest, especially from asset managers and banks. Among the almost 220 investors, backers from Germany and France dominated demand, followed by buyers from southern Europe and Scandinavia. Market participants were particularly attracted by the transaction’s compliance with ESG (environmental, social and governance) criteria. In the end, almost half the total volume was placed with predominantly sustainable investors.

Shortly before this issue, in January BayernLB very successfully launched its green commercial paper programme, as one of the first issuers in Europe. Within just a few days it had placed over EUR 150 million with institutional investors. Like the green bonds, the green commercial paper issues are based on BayernLB’s Sustainable Financing Framework.

“We are delighted to once again demonstrate our expertise in sustainable finance with the green benchmark bond and the green commercial paper. With these deals, we are responding to the growing demand for green finance products on the market and rounding out our range of sustainable products on the issuer side Group-wide. Following several ESG issues by DKB (green senior bonds, blue social covered bond, social covered bond) and BayernLabo’s social bond, today’s placement marks the sixth sustainable bond for the BayernLB Group” commented Stephan Winkelmeier, CEO of BayernLB.

Since 2006, the BayernLB Group has held Prime Status in the sustainability rating by ISS ESG (formerly oekom research), making it one of the top 10-ranking banks worldwide.