Washington, DC, June 16, 2015 – The World Bank (International Bank for Reconstruction and Development or IBRD, rated Aaa/AAA) is pleased to announce that the total issue amount of green bonds linked to the performance of the Ethical Europe Equity Index, known as World Bank Green Growth Bonds, has exceeded USD 500 million in total notional outstanding. This milestone was reached following the successful conclusion of the World Bank’s first Green Growth Bond for retail investors in Italy (Green Growth Bond 07/2023), which closed on Friday, June 12, totaling USD 83.54 million.
The World Bank first issued a green bond linked to the Ethical Europe Equity Index in August 2014, a EUR 50 million private placement with BNP Paribas Cardif. Since then, the World Bank has issued a series of Green Growth Bonds - both institutional private placements as well as retail offerings, across geographical regions and investor bases. The World Bank’s first equity index-linked Green Growth Bond for retail investors was in Belgium in January 2015, for a total of USD 91 million. Thereafter, the World Bank diversified the program to reach other investors in Europe, including Switzerland, Luxembourg and France, as well as investors in Asia (Hong Kong and Singapore) and the US. Following the close of the subscription period for the most recent Green Growth Bond 07/2023 for Italian retail investors, the World Bank has raised more than USD 500 million through Green Growth Bonds – approximately USD 365 million from international retail and high net worth investors and approximately USD 165 million through institutional private placements with European insurance companies, pension funds and private banks.
Green Growth Bonds form part of the World Bank’s Green Bond program. Since its first green bond launched in 2008, the World Bank has issued 100 green bonds in 18 currencies, totaling over USD 8.4 billion equivalent.
Green Bonds: World Bank green bonds offer investors an opportunity to support environmental solutions through a bond product that benefits from the triple-A credit strength of the World Bank. World Bank green bonds support the financing of projects in member countries that meet specific criteria for low carbon and climate resilient growth, seeking to mitigate climate change or help affected people adapt to it. The types of eligible projects include renewable energy installations, energy efficiency projects, and new technologies in waste management and agriculture that reduce greenhouse gas emissions and help finance the transition to a low carbon economy. They also include financing for forest and watershed management and infrastructure to prevent climate-related flood damage and build climate resilience.
Ethical Equity Index: The Ethical Europe Equity Index has been designed to deliver long-term performance and consists of 30 European stocks, selected for inclusion based on an analysis by Vigeo, an independent and well-established Environmental, Social and Governance (ESG) rating agency, and Forum Ethibel, an independent Belgian consulting agency that rates and audits sustainability, ethics, and social responsibility metrics of corporations. The index is owned, calculated and managed by Solactive, a global index provider.
BNP Paribas Corporate and Institutional Banking has partnered with the World Bank to develop the Green Growth Bond product, bringing to bear BNP’s traditional strengths in structured solutions and debt capital markets, and its commitment to drive progress in sustainable and responsible investment solutions.
“With this 12th Green Growth Bond, the World Bank has reached another milestone for its green bond program – over USD 500 million ethical equity index-linked green bonds have now been placed with institutional and retail investors around the world. We are very grateful for the excellent collaboration with BNP Paribas across business lines and across the globe for the development and distribution of this innovative product. The success of the Green Growth Bond highlights the increased investor interest in sustainable investment opportunities that provide environmental and social benefits in addition to the financial performance of the investment,” said Doris Herrera-Pol, Director and Head of Global Capital Markets at the World Bank.
“BNP Paribas are delighted to have now helped raise over $500m for the World Bank via the Green Growth Bond Programme. At BNP Paribas, we believe that our corporate social and responsible values can be successfully harnessed with our innovative capabilities to provide our clients with new solutions for their increased demand for ethical investing. This new product offering has been successfully distributed across our global multi-product sales distribution platform accessing institutional, retail and private clients in Europe, Asia and the United States. We would like to thank the World Bank for their professionalism and dedication in their collaboration on the Green Growth Bond and we look forward to building on our initial success in the future,” said Olivier Osty, Global Head of Sales and Trading at BNP Paribas.
Transaction Summary of the Green Growth Bond 07/2023 for Italian Retail Investors (*):
World Bank (International Bank for Reconstruction and Development, IBRD)
Aaa (Moody’s)/AAA (S&P)1
Aggregate nominal amount:
From May 18, 2015 to June 12, 2015.
June 15, 2015
June 29, 2015
Final observation date:
June 15, 2023.
July 5, 2023
100% of the Specified Denomination for each Note
the Issue Price
Rate of interest for the fixed coupons:
1.75% payable annually in arrear
Interest payment dates for the fixed coupons:
June 29, 2016 and June 29, 2017
Fixed coupon amount:
USD 35.00 per Specified Denomination
Ethical Europe Equity Index (Bloomberg Code: SOLEEE)
Index Linked Interest Amount:
If no Amendment Event (as defined in the Final Terms) has occurred on or prior to the Final Observation Date, the Index Linked Interest Amount, calculated per Specified Denomination, shall be payable on the Maturity Date and will be an amount in USD calculated by the Calculation Agent in accordance with the following:
If an Amendment Event has occurred on or prior to the Final Observation Date, no Index Linked Interest Amount shall be payable.
“Average Index Return” means the quotient, expressed as a percentage, as calculated by the Calculation Agent, equal to (i) the Average Index Level (Sf) minus the Initial Index Level (S0) divided by (ii) the Initial Index Level (S0).
“Closing Level” on any Trading Day means the official closing level of the Index or any Successor Index published by the Index Sponsor at the Scheduled Closing Time as determined by the Calculation Agent.
“Index” means the Ethical Europe Equity Index.
“Sf” or “Average Index Level”, means the arithmetic mean (rounded to the nearest four (4) decimal places, 0.00005 rounded upwards) of the Closing Levels (as defined above) of the Index on each Sf Observation Date n, as calculated by the Calculation Agent.
“Sf Observation Date n” means June 15, 2016 (n=1), June 15, 2017 (n=2), June 15, 2018 (n=3), June 17, 2019 (n=4), June 15, 2020 (n=5), June 15, 2021 (n=6), June 15, 2022 (n=7) and June 15, 2023 (n=8) (the “Final Observation Date”) (each a “Scheduled Sf Observation Date”), each such Scheduled Sf Observation Date subject to postponement in the event such Trading Day is a Disrupted Day as defined in the Final Terms.
“S0” or “Initial Index Level”, means the Closing Level (as defined above) of the Index on the Initial Observation Date as calculated by the Calculation Agent.
“Initial Observation Date” means the Trade Date.
Redemption at maturity:
Application will be made by the Dealer for the Notes to be admitted to listing and to trading on the Mercato Telematico delle Obbligazioni (MOT), EuroMOT segment, organized and managed by Borsa Italiana S.p.A. (regulated market)
1. Moody’s / S&P rating as of 05/31/2015. A credit rating (i) is subject to downward revision, suspension or withdrawal at any time by the assigning rating organization, (ii) does not take into account market risk or the performance-related risks of the investment, and (iii) is not a recommendation to buy, sell or hold securities. A credit rating relates to the ability of the issuer to pay its obligations generally. The Notes have not been and will not be rated.
(*) Nothing in this document should be construed as a solicitation or offer, legal, tax or other advice, or recommendation to engage in any transaction. The information in this document does not constitute a recommendation of the instrument referred to. It merely provides information and is not intended to be either a recommendation to acquire financial products or an offer or invitation to tender. Any offer of the Notes will solely take place on the basis of the Prospectus, the Final Terms and related legal documentation. For a detailed description of the Terms and Conditions of the Notes and the related risks with regard to an investment in the bonds, please see the relevant legal documentation available at www.GreenGrowthBond.com.
About the World Bank
The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody’s/S&P), is an international organization created in 1944. It operates as a global development cooperative owned by 188 nations. It provides its members with financing, expertise and coordination services so they can achieve equitable and sustainable economic growth in their national economies and find effective solutions to pressing regional and global economic and environmental problems. The World Bank Group has two main goals: to end extreme poverty and promote shared prosperity. The World Bank (IBRD) seeks to achieve them primarily by providing loans, risk management products, and expertise on development-related disciplines to its borrowing member government clients in middle-income countries and other creditworthy countries, and by coordinating responses to regional and global challenges. The World Bank has been issuing bonds in the international capital markets for over 60 years to fund its sustainable development activities and achieve a positive impact. Information on bonds for investors is available on the World Bank Treasury website: www.worldbank.org/debtsecurities
For more information about World Bank green bonds, see: https://treasury.worldbank.org/greenbonds.
About BNP Paribas
BNP Paribas has a presence in 75 countries with more than 185,000 employees, including 145,000 in Europe. It ranks highly in its two core activities: Retail Banking & Services (comprised of Domestic Markets and International Financial Services) and Corporate & Institutional Banking. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail banking model across Mediterranean basin countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Institutional Banking and International Financial Services activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas and solid and fast-growing businesses in Asia-Pacific.
Solactive AG is one of the key players in the indexing space. Focusing on tailor-made indices, the German multi asset class provider is developing, calculating and distributing them worldwide. As of 30th June 2014, Solactive AG calculates indices for over 160 clients in Europe, America and Asia. Approximately 25 billion USD are invested in products linked to indices calculated by the Company globally, primarily via 145 ETFs.
Solactive is a registered trade mark of Solactive AG. Solactive does not manage, sponsor, endorse, promote or sell any investment products based on the Ethical Europe Equity Index.
Founded in 2002 and led by Nicole Notat, Vigeo is the leading European expert in evaluating corporate social responsibility through six domains: environment, human rights, human resources, community involvement, business behavior, and corporate governance. Vigeo offers two types of services through two business brands:
- Vigeo rating – the way to responsible investment – offers a broad range of products and services to investors and asset managers who seek a sustainable and responsible performance of their investments on more than 3,000 issuers: companies, regions and states;
- Vigeo enterprise – the way to responsible management – works directly with organizations of all sizes from both public and private sectors, conducts global CSR audits and benchmarks, supports teams and integrates CSR/SRI criteria into business functions and strategic operations.
Vigeo Rating's research meets high quality standards and has been externally certified to the Arista standard since 2009, a quality standard for SRI research. Vigeo is present in Paris, Casablanca, Brussels, Milan, London, Tokyo and Santiago of Chile and has more than 120 employees.
About Forum Ethibel
Forum ETHIBEL is an independent association whose goal is to raise the awareness of both the general public and institutions, so that they make investments in line with the ethical values it promotes. As an independent advisor and auditor on SRI in Europe, Forum ETHIBEL provides specific instruments and labels to support investors in their search for SRI products. Based on Vigeo data and ratings, Forum ETHIBEL draws up the Ethibel Investment Register as the basis of the label Ethibel EXCELLENCE and the indices ESI Excellence Europe and Global.