Project Details
Project
NH Bank Green, Social, and Sustainability Bonds Framework Second-Party Opinion
Client
NongHyup Bank
Project Type
Sustainability Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
South Korea
Evaluation Date
Dec 2018
Evaluation Summary
Sustainalytics is of the opinion that the NongHyup Bank Green, Social, and Sustainability Bonds (“GSS Bonds”) Framework is credible and impactful, and aligns with the Sustainability Bond Guidelines 2018. This assessment is based on the following:
USE OF PROCEEDS
The eight green categories and the six social categories for eligible use of proceeds are aligned with those recognized by the Green Bond Principles, the Social Bond Principles, and the Sustainability Bond Guidelines 2018. Although the financing is not exclusively project-based, Sustainalytics considers the eligible green and social projects to have positive environmental and social impacts and to advance many of the UN Sustainable Development Goals.
PROJECT EVALUATION/SELECTION
A dedicated Sustainability Bond Working Group (SBWG) will oversee NH Bank’s internal process in evaluating and selecting projects. The SBWG will consist of members from various departments, including the Treasury Department, and the Agriculture & Food Finance Department. This is in line with market practice.
MANAGEMENT OF PROCEEDS
NH Bank will track the net use of proceeds through a GSS Bond Register. The proceeds of the transaction will be deposited in the general funding accounts and earmarked for allocation to eligible assets. NH Bank has procedures to allocate proceeds to outstanding indebtedness, and/or to temporarily invest in cash, cash equivalents, investment grade securities or other marketable securities and short-term instruments or other capital management activities. This is in line with market practice.
REPORTING
NH Bank intends to publish information on its website within one year of issuance, and on an annual basis. Allocation reporting will include the total amount allocated to eligible projects as well as the balance of unallocated proceeds and, where possible, impact reporting will include relevant social and environmental metrics. Sustainalytics views NH Bank’s allocation and impact reporting as aligned with market practice.