Raiffeisen Bank placed a new issue of sustainable bonds in local currency
Raiffeisen Bank S.A. successfully placed on Friday, November 25, a new issue of corporate bonds in RON, being the fourth non-preferential senior bond issue out of the bank’s six eligible bond issues.
The bonds were addressed to institutional investors and attracted approximately 369 million RON with a maturity of 5 years, at a fixed coupon of 8.817%, respectively 1.2 p.p. over the yield of government securities with the same maturity.
Also, the bonds are to be included in the base of own funds and eligible liabilities of the bank, after the approval of the National Bank of Romania, and will be listed both on the Luxembourg Stock Exchange (LuxSE) and on the Bucharest Stock Exchange (BVB).
The funds raised will be used to finance sustainable projects, according to the eligibility criteria described in the bank’s Framework for Sustainable Obligations.
At least 50% of the funds will be directed to the financing of social projects – the financing of small and medium-sized enterprises in underdeveloped regions at the national level, affordable housing, access to essential health services, education and infrastructure.
The difference will be allocated to finance projects that support the green transition – green buildings, renewable energy projects, energy efficiency projects, ecological transport and agriculture, pollution prevention and control projects, circular economy, sustainable management of water resources.
Through the issues of eligible bonds placed in the last two years, in the total amount of over 3.3 billion lei, the bank strengthens its base of funds and eligible debts in line with the regulatory requirements, thus creating the premises for a sustainable development of the lending activity.
The European directive on bank recovery and resolution (BRRD I and II), transposed into local legislation by law 312/2015 with subsequent updates and amendments, provides for the creation at the level of all credit institutions in the European Union of a financial reserve additional to own funds, mainly in the form of eligible debt instruments subordinated to bank deposits, with the aim of contributing to increasing the financial stability of the banking system and increased protection of depositors.