Colombia: Bancolombia Issues First Green Bond for 350 Billion Colombian Pesos, W...

Dec 2016
Colombia, December, 05 2016 - This marks the first green bond issued by a commercial bank in Latin America. IFC, a member of the World Bank Group, is the sole investor in the bond.

Bancolombia, Colombia's largest commercial bank, has issued its first green bond, raising 350 billion Colombian pesos-equivalent to $115 million-to expand financial services for private sector investments that help to address climate change. This marks the first green bond issued by a commercial bank in Latin America. IFC, a member of the World Bank Group, is the sole investor in the bond.

IFC is one of the earliest issuers of green bonds, having launched a green bond program in 2010 to help catalyze the market and unlock investment for private sector projects that support renewable energy and energy efficiency. To date, IFC has issued $5.6 billion in green bonds in a range of currencies, including two benchmark $1 billion issuances that were, at the time, the largest such issuances in the markets. IFC also plays a leadership role in developing guidelines and procedures for the green bond market, and in supporting green bond issuances of private sector companies in emerging markets. Bancolombia President Juan Carlos Mora said:

'This bond is part of our corporate commitment to sustainability. We want to reduce our direct environmental footprint and encourage clients and partners to do the same by providing services and products that enable them to invest in areas like renewable energy and sustainable buildings. By doing this we continue to realize our aim of improving the lives of people and businesses by providing them with opportunities to enjoy a better future.'

Carlos Leiria Pinto, IFC manager for the Andean region, said: 'Addressing climate change is a priority for IFC, and green bonds are a powerful mechanism to channel investment for climate-smart investments. By investing in the first green bond issued by Bancolombia, we hope to pave the way for other issuers and investors and contribute to the development of the green bond market in Colombia.' By supporting green buildings and other climate-smart projects, the Bancolombia bond will help Colombia meet the challenge of reducing its emission of pollutants by 20 percent by 2020. IFC is planning to expand its regional portfolio in Latin America earmarked for urban infrastructure, such as buildings, transport, waste management, energy, water and sanitation, and environmentally friendly telecommunications.

IFC will also continue to support the development of financial instruments such as green bonds to ensure that capital markets maintain their role as catalysts for climate financing.

In addition, as part of its sustainability strategy, Bancolombia has broken important ground by introducing green credit lines with its own resources, as well as by incorporating second-floor bank products and lines financed from international cooperation resources. This green bond issue is the most recent initiative of the organization in this area. This operation was structured by Banca de Inversion Bancolombia.

Source : 4-traders

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