Second-Party Opinion Download

Sustainalytics is of the opinion that the BNG Bank Sustainability Bond for Dutch Social Housing Associations is credible and impactful and aligns with the four core components of the Social Bond Principles 2018, Green Bond Principles 2018 and Sustainability Bond Guidelines. This assessment is based on the following:

USE OF PROCEEDS

The eligible category for the use of proceeds is aligned with those recognized by the Social and Green Bond Principles that seek to achieve positive environmental and socioeconomic outcomes for target populations. While the proceeds of the bond will not be used for project financing, but general purpose loans for social housing associations, Sustainalytics notes that the financing of best-in-class social housing associations can raise the bar for sustainability for the housing associations, while simultaneously financing affordable housing. In addition, the use of proceeds advances the UN Sustainable Development Goal 11.

PROJECT EVALUATION/SELECTION

BNG Bank’s methodology for the selection of best-in-class social housing associations was developed by Telos of Tilburg University. Sustainalytics is of the opinion that the methodology is robust and credible.

MANAGEMENT OF PROCEEDS

BNG Bank’s processes for management of proceeds is aligned with market practice. BNG Bank has systems to link the bond’s proceeds to individual loans for housing associations, which is controlled by internal audits. Unallocated proceeds are managed according to BNG Bank’s liquidity policy. This process is aligned with market practice.

REPORTING

While BNG Bank will not provide annual allocation reporting, it intends to report to investors when the proceeds are fully allocated, which is expected to be shortly after issuance. In addition, BNG Bank is committed to disclosing on an annual basis the selection of social housing associations, their sustainability score and contribution to the SDGs as well as changes in Sustainability scores compared to previous years. While the indicators consider the number of inhabitants that are below certain income thresholds, the total number of people benefitting from affordable housing of the eligible housing associations is not disclosed. While this is a limitation of the framework, Sustainalytics considers the reporting of sustainability scores to be a good indication of environmental and social improvements of the social housing associations financed.