Nedbank Corporate and Investment Banking (Nedbank CIB) has successfully launched a R2 billion sustainability tier II bond for the Nedbank Group, which was officially listed on the JSE’s sustainability segment on 7 November 2024.

This bond garnered demand that was twice the amount offered, targeting crucial social and environmental issues within South Africa.

The funds raised will be directed toward three key focus areas:

• Affordable housing – This initiative aims to provide mortgages to low-income women, enhancing female homeownership and improving access to housing, which addresses the historically low rates of female property ownership in South Africa.
• Water infrastructure – Focused on expanding access to safe drinking water and improving sanitation through sustainable water management solutions, this initiative is essential for guaranteeing adequate sanitation facilities and improving the quality and efficiency of the available water supply.
• Climate-smart agriculture – Supporting projects that promote sustainable agricultural practices and improve productivity and water efficiency for local farmers. Solutions include water conservation techniques, soil health improvements, advanced irrigation systems, and protective shade netting for crops during severe weather conditions.

These areas of focus were established through comprehensive internal collaboration, leveraging insights from Nedbank’s Tabono Women Advancement Programme, which empowers women with vital skills for growth within the organization. This strategy aligns with Nedbank’s Sustainable Finance Fundraising Framework and its commitments to sustainable development.

Nedbank is the only South African bank to issue a sustainability tier II bond with this distinctive combination of use-of-proceeds categories, which includes both green and social impact elements that extend beyond the standard renewable energy, affordable housing, and green buildings categories.

Impact

The bond’s impact will be quantitatively assessed and reported annually during its lifespan, including detailed reports on the number of mortgages granted to women, the volume of water supplied or conserved each year, and the productivity or water savings achieved through climate-smart agriculture initiatives.

This transaction was backed by a pre-issuance second-party opinion from S&P Global.

Nedbank will conduct annual compliance verifications to the JSE post-issuance, ensuring ongoing conformity with the Sustainable Bond Principles established by the International Capital Markets Association.

Johan Malan, principal of Sustainable Finance Solutions at Nedbank CIB. Image: Supplied

Nedbank remains dedicated to realizing its mission of utilizing financial expertise for the betterment of clients and society.

We recognize that one of the most effective ways to achieve this is by channeling financing towards initiatives that produce positive environmental and social outcomes, contributing to relevant Sustainable Development Goal targets in our local context.

Integrating sustainable finance solutions is fundamental to our business model.

The bond was crafted by the Nedbank CIB Sustainable Finance Solutions team, with contributions from the Debt Capital Markets, Syndication, and Distribution teams.

The successful completion of this transaction underscores the collaborative efforts within Nedbank, including partnerships with teams in Public Sector, Construction, Agriculture in Investment Banking, and the Home Loans team in Retail and Business Banking.

Johan Malan is the principal of Sustainable Finance Solutions at Nedbank CIB.

Brought to you by Nedbank Corporate and Investment Banking (CIB).

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