Project Details
Project
Nykredit Green Bond Framework Second-Party Opinion (2023)
Client
Nykredit
Project Type
Green Bond/Loan
Industry Group
Banks
Use of Proceeds
Green buildings; Renewable energy; Clean transport; Water/waste water management; Natural resources/land use management; Climate change adaptation;
Location
Denmark
Evaluation Date
Mar 2023
Evaluation Summary
USE OF PROCEEDS
The eligible categories for the use of proceeds – i) Green Buildings, ii) Renewable Energy, iii) Clean Transportation, iv) Energy Distribution and Storage, v) Manufacturing, vi) Sustainable Water, Sewage and Waste Management, vii) Sustainable Management of Living Natural Resources and Land Use; and viii) Climate Change Adaptation – are aligned with those recognized by the Green Bond Principles. Sustainalytics considers that investments in the eligible categories will lead to positive environmental impacts and advance the UN Sustainable Development Goals, specifically SDGs 6, 7, 9, 11, 12, 13 and 15.
PROJECT EVALUATION AND SELECTION
Nykredit’s Green Bond Committee will be responsible for evaluating and selecting projects that are in line with the Framework’s eligibility criteria. Nykredit’s internal policies and processes for mitigating environmental and social risks related to loans and projects apply to all allocation decisions made under the Framework. Sustainalytics considers these risk management systems to be adequate and the project selection process in line with market expectation.
MANAGEMENT OF PROCEEDS
Nykredit’s Group Treasury is responsible for the management of proceeds and will track the allocation of proceeds using a dedicated registry. Nykredit intends to allocate all proceeds within six months of issuance. Any unallocated proceeds will be held temporarily in accordance with Nykredit’s standard liquidity management policy. This is in line with market practice.
REPORTING
Nykredit intends to report on allocation of proceeds on its website on an annual basis until maturity or full allocation. Allocation reporting will include the total outstanding amount of green bonds, the total amount of net proceeds allocated, a breakdown by category and geographical distribution, and new loans entering the pool over the previous reporting year. In addition, Nykredit is committed to reporting on relevant impact metrics. Sustainalytics views Nykredit’s allocation and impact reporting as aligned with market practice.