According to Bruce Stewart, head of debt capital market origination at Nedbank CIB, the issue of Renewable Energy Bond forms a key part of Nedbank’s commitment to delivering tangible financial support to projects that contribute towards the achievement of the United Nation’s Sustainable Development Goals.
Sprouting in 2017, the sector aims to help companies and other institutions to raise funds ring-fenced for low-carbon initiatives. In addition, it enables investors to contribute towards mitigating the effects of climate risk as part of their investment portfolio.Many institutional investors have mandates that require them to list in listed instruments.
John Haslett, portfolio manager, Alpha Asset Management, says the Nedbank bond is not asset-backed, which is in line with ordinary senior unsecured bonds committed to green projects. They should trade similarly to these types of bonds — most managers primarily take credit exposure on the fixed income size.