Project Details
Project
BancoEstado Sustainability Framework Second-Party Opinion (2024)
Client
Banco del Estado de Chile
Project Type
Sustainability Bond/Loan
Industry Group
Banks
Use of Proceeds
SME finance and microfinance; Green buildings; Renewable energy; Energy efficiency; Clean transport; Natural resources/land use management; Eco-efficient products; Affordable housing;
Location
Chile
Evaluation Date
Mar 2024
Evaluation Summary
Sustainalytics is of the opinion that the BancoEstado Sustainability Framework is credible, impactful and aligned 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 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 1, 5, 7, 8, 9, 11, 12 and 15.
PROJECT EVALUATION AND SELECTION
BancoEstado’s Sustainable Finance Coordination Working Group will be responsible for evaluating and selecting eligible assets. BancoEstado has internal procedures in place to identify and manage environmental and social risks associated with assets financed, which are applicable to all allocation decisions made under the Framework. Sustainalytics considers these risk management systems to be adequate and the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
BancoEstado’s Finance Department will oversee the allocation of proceeds to eligible assets and will track the allocation of net proceeds through its annual financial audit process. BancoEstado commits to allocate net proceeds to eligible projects within 36 months of issuance on a best-effort basis. Pending allocation, unallocated proceeds will be held temporarily in cash or other liquidity instruments in BancoEstado’s treasury liquidity portfolio. This is aligned with market practice.
REPORTING
BancoEstado commits to report on allocation of proceeds on its website on an annual basis until full allocation. Allocation reporting will include the total amount of bond proceeds allocated, in whole or in part, to each eligible asset, the progress of assets financed, and the balance of unallocated net proceeds. In addition, Banco Estado intends to report on relevant impact metrics. Sustainalytics views BancoEstado’s allocation and impact reporting as aligned with market practice.