Project Details
Project
Banco BTG Pactual Sustainable Financing Framework Second-Party Opinion (2024)
Client
Banco BTG Pactual S.A.
Project Type
Sustainability Bond/Loan
Industry Group
Banks
Use of Proceeds
Renewable energy; Energy efficiency; Clean transport; Green buildings; Pollution prevention and control; Natural resources/land use management; Water/waste water management; Conservation; Affordable housing; Affordable basic infrastructure; SME finance and microfinance; Socio-economic advancement;
Location
Brazil
Evaluation Date
Jun 2024
Evaluation Summary
Sustainalytics is of the opinion that the Banco BTG Pactual Sustainable Financing Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021, Social Bond Principles 2023, Green Loan Principles 2023 and Social Loan Principles 2023. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds are aligned with those recognized by both the Green Bond Principles, Social Bond Principles, Green Loan Principles and Social Loan Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental or social impacts and advance the UN Sustainable Development Goals, specifically SDGs 6, 7, 8, 9, 10, 11, 12 and 15.
PROJECT EVALUATION AND SELECTION
The project evaluation and selection process will be carried out cross-functionally, with input from the Bank’s ESG team, which will be responsible for project selection. The Bank’s governance structure includes its board of directors, ESG Committee, Chief of Sustainability Officer and ESG team, which will be responsible for implementing policies related to environmental, social and climate risks. The Bank also uses the IFC Performance Standards for financing above a certain ticket size. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
Proceeds from the instruments issued under the Framework will be tracked and managed by BTG Pactual’s Treasury Team. BTG Pactual intends to allocate all proceeds of each issuance within 36 months. Pending allocation, the Bank will hold the proceeds in cash and cash equivalents. Sustainalytics considers this process to be aligned with market practice.
REPORTING
BTG Pactual commits to report on allocation within approximately one year from issuance, and thereafter once a year, until full allocation. The allocation reports of deposits will be shared annually with deposit holders. Allocation reporting will include a sample list of projects financed with proceeds of the issued instruments, allocated versus unallocated amounts, a breakdown of financed versus refinanced projects. In addition, BTG Pactual intends to report on relevant impact metrics. Sustainalytics views BTG Pactual’s allocation and impact reporting as aligned with market practice.