Project Details
Project
OCBC Sustainability Bond Framework Second-Party Opinion (2023)
Client
OCBC Bank
Project Type
Sustainability Bond/Loan
Industry Group
Banks
Use of Proceeds
Renewable energy; Pollution prevention and control; Clean transport; Water/waste water management; Climate change adaptation; Green buildings; Access to essential services; Affordable housing; SME finance and microfinance;
Location
Singapore
Evaluation Date
Jun 2023
Evaluation Summary
Sustainalytics is of the opinion that the OCBC Sustainability Bond Framework is credible and impactful and aligns with the Sustainability Bond Guidelines 2021, Green Bond Principles 2021, Social Bond Principles 2021, ASEAN Green Bond Standards 2018, ASEAN Social Bond Standards 2018 and ASEAN Sustainability Bond Standards 2018. This assessment is based on the following:
USE OF PROCEEDS
The eligible categories1 for the use of proceeds are aligned with those recognized by the Green Bond Principles, Social Bond Principles, ASEAN Green Bond Standards, ASEAN Social Bond Standards and ASEAN Sustainability Bond Standards. Sustainalytics considers that investments in the eligible categories will lead to a positive environmental or social impact and advance the UN Sustainable Development Goals, specifically SDGs 3, 4 ,6, 7, 9, 11, 12 and 15.
PROJECT EVALUATION AND SELECTION
OCBC Group’s business units are responsible for evaluating and selecting projects in line with the Framework’s eligibility criteria and the OCBC Sustainability Council is responsible for approving the eligible projects. The OCBC Sustainability Council is chaired by the Group Chief Executive Officer and comprises OCBC’s senior management. OCBC Group has developed a Responsible Financing Framework to identify and manage ESG risks associated with the eligible projects, which is applicable to all allocation decisions made under the OCBC Sustainability Bond Framework. Sustainalytics considers that the project selection process aligns with market practice.
MANAGEMENT OF PROCEEDS
The OCBC Sustainability Council will be responsible for the management and allocation of proceeds on a portfolio basis through a register. OCBC Group intends to allocate proceeds within 36 months of issuance. Pending allocation, unallocated proceeds will be temporarily invested in cash, cash equivalents or high-quality marketable instruments. This is in line with market practice.
REPORTING
OCBC Group intends to report on the allocation of proceeds and corresponding impact in an annual progress report, which will be published on its website or provided to lenders on an annual basis until bond maturity. The report will include a description of the eligible assets and projects financed, the aggregate amount allocated per each eligible category, the outstanding balance of unallocated proceeds, and relevant impact metrics. Sustainalytics views OCBC Group’s allocation and impact reporting as aligned with market practice.