CABEI Green and Blue Bond Framework Second-Party Opinion (2022)
Central American Bank for Economic Integration (CABEI)
Use of Proceeds
Natural resources/land use management; Renewable energy; Clean transport; Energy efficiency; Climate change adaptation; Water/waste water management;
Sustainalytics is of the opinion that the CABEI Green and Blue Bond Framework is credible and impactful and aligns with the four core components of the Green Bond Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds –Sustainable Land Use, Renewable Energy Generation, Clean Transportation, Energy Efficiency, Climate Change Adaptation, Water Resources Protection, Sustainable Water Management, Renewable Energy, Blue Economy and Nature Protection – are aligned with those recognized by the Green Bond Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental impact and advance the UN Sustainable Development Goals, specifically SDGs 6, 7, 11, 12, 13, 14 and 15.
PROJECT EVALAUTION AND SELECTION
CABEI’s Green and Blue Bond Working Group will evaluate, select and monitor eligible projects and assets according to the eligibility criteria. The group will include representatives from CABEI’s Finance Department, the Environmental and Social Monitoring Office and the public and private sectors. CABEI’s Environmental and Social Risk Identification, Evaluation and Management system is applicable to all allocation decisions made under the CABEI Green and Blue Bond Framework. Sustainalytics considers this risk management system and project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
CABEI’s Department of Investments, Asset and Liability Management will allocate and track net proceeds from issuances made under the Green and Blue Bond Framework. CABEI intends to fully allocate proceeds within 36 months of issuance. Pending allocation, unallocated proceeds will be temporarily held or invested in cash or liquid instruments. This is in line with market practice.
CABEI intends to report on the allocation of proceeds and the corresponding impact on its website on an annual basis until full allocation. Allocation reporting will include the total amount of proceeds allocated to the projects under each category, a description of the projects to which proceeds are allocated, the share of financed versus refinanced projects and the balance of unallocated proceeds. In addition, CABEI is committed to reporting on relevant impact metrics. Sustainalytics views CABEI’s allocation and impact reporting as aligned with market practice.