Project Details
Project
Forbright Green Financing Framework Second-Party Opinion (2021)
Client
Forbright Bank
Project Type
Green Bond/Loan
Industry Group
Banks
Use of Proceeds
Renewable energy; Energy efficiency;
Location
U.S.
Evaluation Date
Dec 2021
Evaluation Summary
Sustainalytics is of the opinion that Forbright’s Green Financing Framework is credible and impactful and aligns to 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 – Renewable Energy and Energy Efficiency – are aligned with those recognized by the Green Bond Principles. Sustainalytics considers that investments in the eligible categories will facilitate the transition to a low carbon economy in the US and advance the UN Sustainable Development Goals, specifically SDG 7: Affordable and Clean Energy.
PROJECT EVALUATION / SELECTION
Forbright has established the ESG Lending Working Group (the “Working Group”) and the ESG Strategy Committee (Strategy Committee) for assessing and approving potential eligible projects. Such projects will be identified using the Sustainable Finance Addendum by the Working Group and presented to the Strategy Committee for final review and confirmation. The Working Group will also oversee the environmental and social risk assessment and management of eligible projects. Sustainalytics considers these risk management systems to be adequate and the project selection process to be in line with market practice.
MANAGEMENT OF PROCEEDS
A Sustainable Asset Tracking (“SAT”) group will track and monitor the allocation of proceeds to eligible projects via an existing internal tracking system. Forbright intends to allocate net proceeds within 12 months of issuance. Pending allocation, unallocated proceeds will be temporarily held in line with the Bank’s internal liquidity policy and may be temporarily invested in cash or cash equivalents. This is in line with market practice.
REPORTING
Forbright intends to report on the allocation of proceeds in a report to be published on its website, on annual basis until full allocation. The allocation reporting will include a description of projects financed, the amount allocated by category and the unallocated balance. In addition, Forbright is committed to reporting on relevant impact metrics, achieved or expected, where feasible. Sustainalytics views the Bank’s allocation and impact reporting as aligned with market practice.