Financial services firm Nedbank has concluded a R2.1-billion Green Private Power Tier 2 Bond, listed on the sustainability segment of the JSE, with the proceeds to focus on notionally funding private renewable energy projects in South Africa.

Private renewable energy power projects refer to commercial and utility-scale renewable energy projects with private corporate offtakers. These projects will play a pivotal role in advancing renewable energy capacity, accelerating the transition to a low-carbon economy and lending support to the underlying corporates’ own sustainability objectives.

Through its Corporate and Investment Banking (CIB) division, Nedbank structured and arranged the R2.1-billion Tier 2 green bond, which was met with strong response from investors in the oversubscribed auction process, showing market support for Nedbank's continuous dedication to sustainability and its pivotal role in financing the transition to clean energy.

“As a result of the continued decline in the cost of renewable energy, engaging in this technology gives South African corporates the opportunity to leverage their balance sheets to procure cheap and clean power and support South Africa’s energy transition,” says Nedbank Investment Banking debt finance business co-head Peter van Kerckhoven.

The successful conclusion of the Nedbank Green Private Power Tier 2 Bond is a significant milestone and testament to the bank’s commitment to sustainable finance and renewable energy growth in the country, adds Nedbank CIB sustainable finance solutions head Arvana Singh.

“We remain dedicated to driving innovation and sustainability and having a positive impact through our financial expertise, and we are grateful for the trust and support of our investors, partners and stakeholders in this regard,” she says.

The bond marks the first bond issue under Nedbank’s recently updated Sustainable Finance Use of Proceeds Fundraising Framework, published in August, and is its seventh green bond issuance overall since it became the first South African bank to issue green bonds in 2019.

The bond aligns with the International Capital Market Association Green Bond Principles.