BNDES - Brazilian Development Bank
   




BNDES raises US$ 1 billion in green bonds on the international market

05/09/2017

  • The operation is the first international issue of green bonds from a Brazilian bank
  • Funds will be invested in wind or solar power projects

The Brazilian Development Bank (BNDES) completed the raising of US$ 1 billion in green bonds this Tuesday (May 9) on the international market. The bonds are due in 2024. This is the first time that a Brazilian bank has made an issue of green bonds in the international market. The demand has reached US$ 5 billion in orders with the participation of more than 370 investors in the process of pricing the bonds. The last time the Bank made an issue abroad was in 2014.

The bonds have features similar to conventional ones; however, the funds obtained will be destined for financing environmentally sustainable projects, certified by a company specialized in the environmental area. In the case of BNDES, they are aimed at new or already existing wind or solar generation projects in the portfolio of the Bank.

The issue valorizes the Bank’s support to initiatives of renewable energy generation: between 2003 and 2016, in the wind power sector alone, the Bank approved 87 credit operations totaling R$ 28.5 billion in credit, increasing the installed capacity by about 10.7 GW. The release of this bond is added to the various initiatives of BNDES to play its role as inducer of sustainable development.

Remuneration – The operation resulted in a rate of return to the investor of 4.80% per annum, which represents a premium of 269.3 basis points on the rates of the bonds from the Treasury of the United States of America and about 60 basis points on the external bonds from the Federative Republic of Brazil.

The bonds will be listed on the Luxembourg Green Exchange. The operation, which was coordinated by the Bank of America Merrill Lynch, Crédit Agricole and JP Morgan, has enabled a large breaking up of bonds for buyers of several investment profiles and different geographic regions (United States of America, Europe, Asia and Latin America), diversifying the base of BNDES investors when accessing a range of institutions focused on “green finance.”

The success of this offer of green bonds consolidates the international presence of BNDES and provides a number of benefits, such as to strengthen the priority the Bank gives to social and environmental sustainability; to promote the dissemination of best practices of social and environmental management; to encourage the access of other Brazilian issuers to the market of green bonds and to build a new reference point in its structure for international interest rates.


 

Recent News  Recent News
05/19/2017
Approval of BNDES credit for machinery and equipment increases 38% in the first quadrimester
BNDES Finame, credit line for capital goods, registers increase of almost 200% in approvals for the Industry between January and April
05/09/2017
BNDES gathers experiences from world development banks to start elaborating its long-term strategy
Four months after deeply reformulating its operational policies, the Brazilian Development Bank (BNDES) begins the process of internal reflection that will lead to the development of a medium and long-term strategy, with guidelines until 2030. By the end of the year, a cycle of discussions involving the Bank’s technical staff will discuss what should be the role and performance of BNDES in an economy with low inflation and interest rates. The first step last Friday (05/05) was the accomplishment of the international seminar “The role of development banks in the present and in the future: experiences, opportunities and challenges,” organized in partnership with the World Bank, which gathered executives from eight international institutions and employees from BNDES, for a whole day. The event also marked the beginning of a series of activities to celebrate the 65 years of BNDES, which will be completed in June.