NAB continues to lead in global infrastructure and renewable project financing, offering new and innovative ways to support companies that deliver and support ‘green’ projects around the world.
Last week, NAB finalised two landmark arrangements with one of the UK’s largest environmental utility infrastructure companies, Pennon Group.
“We play an important role in financing the global transition to a low carbon economy and supporting sustainable development, so we’re backing major infrastructure projects around the world that have strong environmental and socially sustainable outcomes,” NAB Chief Customer Officer of Corporate and Institutional Banking, Mike Baird said.
“Green Leases are a new approach to financing green infrastructure, and we’re pleased to be able to offer it to our customers. It’s an example of how NAB, as a major financier, is continually looking for new and innovative ways to support our customers.”
NAB has provided Pennon Group with a five-year Environmental, Social and Governance (ESG) linked Term Loan of £100 million. The loan requires the Pennon Group to meet ESG/Sustainability objectives and key performance indicators based on an ESG Index issued by independent ratings organisation, Sustainalytics, whereby Pennon Group receives a reduced margin on the loan if targets are achieved.
NAB has also provided Pennon Group, through its subsidiary South West Water Limited, a ten-year £30 million Green Lease which will finance the state-of-the-art Mayflower Water Treatment Works in Plymouth in the UK, and other sustainable water and wastewater management assets. The Mayflower will use cutting-edge treatment processes to provide a secure, high-quality drinking water supply for the wider Plymouth area.
The Green Lease has been developed in alignment with Pennon’s Sustainable Financing Framework, which was prepared under the new Loan Market Association guidelines.
In line with NAB’s global focus on infrastructure and renewables financing, NAB also recently settled its first public USD Green Bond issuance, and first United Nations Sustainable Development Goals (SDGs) Green Bond – the first of its kind to be issued by an Australian major bank.
NAB SDG Green Bonds provide an opportunity for investors to allocate capital towards NAB-funded projects that support the transition to a low carbon economy, and contribute towards meeting the United Nation’s SDGs.
The NAB SDG Green bond attracted a diverse range of socially responsible Investors with ESG mandates, as well as regular ‘non-green’ investors.
In 2017, NAB committed to increasing environmental financing for customers from $18 billion by 2022, to $55 billion by 2025. This includes $20 billion to support green infrastructure, capital markets and asset finance, and $35 billion of lending to support the development of 6-star residential mortgages. As at 31 March 2018, NAB has provided $17.5 billion towards this commitment.