Financial institution Standard Bank has successfully signed a $400-million sustainability-linked syndicated term loan. The facility, coordinated by the Industrial and Commercial Bank of China’s London branch (ICBC), Mizuho Bank and Standard Chartered Bank, is Standard Bank’s second sustainability-linked syndicated loan.
“Concluding our second sustainability-linked loan and embedding sustainability KPIs [key performance indicators] into the funding arrangements demonstrates the group’s commitment to sustainability, which is at the heart of our purpose . . . We celebrate closing this transaction shortly after publishing our updated Group Sustainable Finance Framework, which will support green and social treasury instruments executed across the group,” Standard Bank sustainable finance head Sasha Cook said on December 11.
The margin on the loan is linked to Standard Bank’s performance against two sustainability KPIs. The KPIs align with Standard Bank’s sustainability strategy and relate to the committed financing of renewable energy power plants and social projects in South Africa and elsewhere across Africa. The facility is structured as a two-year loan with an option for Standard Bank to elect to extend for a further year.
Standard Bank is focused, primarily through its sustainable finance division, on providing financial products and services that support positive environmental, social and governance outcomes, including green and social loans and bonds, sustainability-linked loans and bonds, sustainable trade and working capital solutions and impact investing. The bank targets mobilising more than R250-billion in sustainable finance by 2026.
"We appreciate the support of our partner banks across the globe as they support us in continuing to fund our clients across our African footprint," Standard Bank treasury head Paul Burgoyne said.
Mizuho and Standard Chartered Bank acted as the sustainability coordinators, Mizuho as the facility agent, Standard Chartered as the documentation agent and the ICBC as the syndication agent.
Standard Bank said the deal was well received in the loan market and was over-subscribed with commitments from 16 geographically diverse institutions. As a result of the oversubscription, the transaction was upsized to $400-million from the launch amount of $300-million.