Project Details
Project
PKO Group Green Bond Framework Second-Party Opinion (2024)
Client
PKO Bank Polski SA
Project Type
Green Bond/Loan
Industry Group
Banks
Use of Proceeds
Green buildings; Clean transport; Renewable energy; Water/waste water management; Pollution prevention and control;
Location
Poland
Evaluation Date
Aug 2024
Evaluation Summary
Sustainalytics is of the opinion that the PKO Group Green Bond Framework is aligned 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 – Financing Buildings, Clean Transportation, Renewable Energy, Sustainable Water Supply Management, Sustainable Wastewater Management, Sustainable Waste Management – 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 and 12.
PROJECT EVALUATION AND SELECTION
PKO Group’s Sustainable Development Committee and PKO Bank Hipoteczny’s Green Covered Bond Committee will evaluate, select and monitor eligible projects. PKO Group’s Sustainable Development Committee comprises two management board members and representatives from different departments, including Administration, Finance, Retail Clients and ESG Sustainable Development. PKO Bank Hipoteczny’s Green Covered Bond Committee comprises one member of the management Board and representatives of the Treasury Office, Residential Mortgage Loans Office, Risk Office, Compliance Office, Controlling Office and Cover Pool Register Responsible Office. PKO Group has internal processes to address environmental and social risks associated with the eligible assets. Sustainalytics considers the project selection process in line with market practice.
MANAGEMENT OF PROCEEDS
PKO Group’s Sustainable Development Committee and PKO Bank Hipoteczny’s Green Covered Bond Committee will be responsible for management and allocation of proceeds on a portfolio basis using an internal tracking system. PKO Group intends to allocate net proceeds within 24 months of issuance. Pending full allocation, PKO Group may temporarily hold unallocated proceeds in cash, cash equivalents or short-term liquid instruments. This is in line with market practice.
REPORTING
PKO Group commits to report on the allocation of proceeds on its website on an annual basis until maturity of the bonds. Allocation reporting may include the notional amount and maturities of the outstanding green bond issues, total amount of proceeds allocated to eligible loans, number of eligible loans, balance of unallocated proceeds, and amount or percentage of the eligible assets’ portfolio allocated. In addition, PKO Group intends to report on relevant impact metrics. Sustainalytics views PKO Group’s allocation and impact reporting as aligned with market practice.