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DBS drives more industry-first with green bond issuance by a university

Ravi Philemon

DBS drives more industry-first bonds with Asia’s inaugural green bond issuance by a university

  • DBS drives more industry-first as it is appointed as sole lead manager and bookrunner for National University of Singapore’s first green bond
  • DBS drives more industry-first as it continues to support clients to issue green bonds; underwrote over SGD 4 billion of green bonds in 2019
dbs drives

DBS drives more industry-first bonds with Asia’s inaugural green bond issuance by a university

DBS Bank announced on May 27 that it is the sole lead manager and bookrunner in Asia’s first green bond issuance by a university. The National University of Singapore’s (NUS) SGD300 million 10-year green bond with a coupon rate of 1.565% also marks Singapore’s first by a public institution, paving the way for more tertiary institutions from the region to tap debt capital markets for their funding needs. The deal was done by way of private placement, fully underwritten by DBS.

Clifford Lee, Global Head of Fixed Income, DBS Bank, said, “Education is viewed globally as a sector that is resilient to economic cycles. We hope that this bond will be the first of many to come, and will heighten the focus on sustainability concerns, especially amidst this period of pandemic-related societal and market stress.”

The bond proceeds will go towards financing green projects by the university. The green bond is expected to be rated Aaa by Moody’s.

DBS drives efforts to develop Asia’s sustainability-linked bonds market

DBS has been steadily supporting its corporate clients to mobilise capital market financing via the issuance of green bonds. In 2019, the bank underwrote over SGD 4 billion worth of green bonds, with the raised proceeds used to finance a number of projects in renewable energy, clean transportation, energy efficiency, and water and wastewater management sectors across the region.

DBS also issued its own green bond back in 2017, which marked the first international green bond issuance out of South-east Asia. The launch of the green bond is in line with the bank’s commitment to sustainability and efforts to adopt a triple bottom line approach in its business activities, focusing on social and environmental goals along with financial objectives.

The bank has since gone on to structure and underwrite other sustainability-linked deals, such as social bonds which have come into the spotlight amid the coronavirus pandemic.

“Social bonds have seen a major upswing in recent months. With the pandemic hitting many communities hard, we see a surge in demand for credit that helps fund causes that make positive social impact. Everyone from institutional investors to central banks is looking for ways to help alleviate the impact faced by the communities they operate in, and we expect to see more of such structures in the year to come,” said Lee.

DBS was joint lead manager for a EUR 500 million issuance for Korea Housing Finance Corporation in 2018. This was Asia’s first social covered bond at the time. The bank has also partnered other parties on the world’s first listed social bond, a USD 8 million Women’s Livelihood Bond in 2017, as well as its second issuance of USD 12 million in Women’s Livelihood Bond 2 earlier this year.

DBS is a leading financial services group in Asia with a presence in 18 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank’s “AA-” and “Aa1” credit ratings are among the highest in the world.

Recognised for its global leadership, DBS has been named “World’s Best Bank” by Euromoney, “Global Bank of the Year” by The Banker and “Best Bank in the World” by Global Finance. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney. In addition, DBS has been accorded the “Safest Bank in Asia” award by Global Finance for 11 consecutive years from 2009 to 2019.

DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets. DBS is committed to building lasting relationships with customers, and positively impacting communities through supporting social enterprises, as it banks the Asian way. It has also established a SGD 50 million foundation to strengthen its corporate social responsibility efforts in Singapore and across Asia.

With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. The bank acknowledges the passion, commitment and can-do spirit in all our 28,000 staff, representing over 40 nationalities.

As part of its commitment to advance the Sustainable Development Goals, DBS has developed the DBS Green Bond Framework (Framework) that sets out the guidelines for Green Bond issuances at DBS in accordance with the four core components of The Green Bond Principles 2017 issued by the International Capital Market Association. DBS has obtained a second opinion on the Framework from Sustainalytics, an independent environmental, social and governance (ESG) and corporate governance research, ratings and analysis firm.

The proceeds from DBS’ Green Bond issuances (Proceeds) will be used to finance or refinance new or existing green assets/projects which meet the criteria outlined below (Eligibility Criteria). Where relevant, the Proceeds may also be used to finance companies that derive 90% or more of their revenues from green assets/projects which meet the Eligibility Criteria.

DBS has developed a list of exclusionary criteria on the use of the Proceeds. In this regard, we commit to not knowingly using the Proceeds for the financing of assets/projects included in the exclusionary criteria.

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