Nedbank became the first South African bank to list such an instrument on the bourse’s platform, which was itself launched in October 2017.
The proceeds will be used to provide financial support to solar and wind projects.
Nedbank CIB debt capital market origination head Bruce Stewart reported that the bond auction, which opened on April 24, “was significantly oversubscribed, demonstrating strong investor appetite for good-quality environmental, social and governance-focused assets".
He added in a statement that the final pricing also exceeded initial expectations.
The bank received bids worth R5.5-billion,more than three times above the amount of R1.7-billion in bonds placed to fund renewables projects.
A diverse spread of investors subscribed for the bonds, including domestic asset managers and impact funds set up by foreign investors. At least 18 investors participated in the book, including the African Local Currency Bond Fund and the WWF fund.
The bond listing sought to build on the bank’s growing experience in the South African renewables sector, developed primarily through the funding of projects under government’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).
Since 2011, 112 renewables projects with a combined investment value of R209.4-billion and a combined capacity of 6 422 MW have been procured through several REIPPPP bid windows.
To date, Nedbank has funded 42 of these transactions, worth a combined R40-billion.
The bond, Stewart said, allowed the bank to further extend support for the provision of clean energy in South Africa.
It also contributed towards the achievement of the United Nation’s Sustainable Development Goals, to which the bank had recently aligned its commercial activities.
Nedbank also recently confirmed that it would no longer participate in the funding of the Thabametsi and Khanyisa coal projects, named in 2016 as preferred bidders under South Africa’s coal procurement programme. The projects have yet to reach financial close.
The Nedbank Renewable Energy Bond was developed in line with International Capital Market Association Green Bond Principles and the Climate Bonds Standard.