Project Details
Project
Fifth Third Bancorp Sustainable Bond Framework Second-Party Opinion(2021)
Client
Fifth Third
Project Type
Sustainability Bond/Loan
Industry Group
-
Use of Proceeds
-
Location
U.S.
Evaluation Date
Oct 2021
Evaluation Summary
Sustainalytics is of the opinion that the Fifth Third Bancorp Sustainable Bond Framework is credible, impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021 and Social Bond Principles 2021. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories for the use of proceeds – Green Buildings, Renewable Energy, Energy Efficiency, Clean Transportation, and Affordable Housing – are aligned with those recognized by both the Green Bond Principles and Social Bond 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 7, 10 and 11.
PROJECT EVALUATION / SELECTION
Fifth Third’s Sustainable Financing and Climate Strategy Council will oversee the internal process for evaluating and selecting projects. Fifth Third’s ESG Committee will be responsible for the final approval of eligible projects in accordance with the eligibility process. Fifth Third’s Environmental and Social Policy, which includes environmental and social risk assessment during loan origination, applies to all allocation decisions made under the Framework. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
Fifth Third’s Finance department will oversee the management of proceeds and will track allocation to eligible assets using a dedicated internal accounting system. Fifth Third intends to reach full allocation within 12 months of issuance and has established a two-year look-back period for refinancing activities. Unallocated proceeds will be temporarily held in cash or cash equivalents, in accordance with Fifth Third’s normal liquidity practices. This is in line with market practice.
REPORTING
Fifth Third intends to report on the allocation of proceeds in a Sustainable Bond Report, published on its website on an annual basis until full allocation. The report will include, subject to confidentiality considerations, the amount of net proceeds allocated to eligible projects, a selection of brief investment or financing descriptions, and the outstanding amount of unallocated proceeds. In addition, Fifth Third is committed to reporting on relevant impact metrics. Sustainalytics views Fifth Third’s allocation and impact reporting as aligned with market practice.