Second-Party Opinion Download

We have reviewed the LGFA Sustainable Financing Bond Framework, under which LGFA intends to issue sustainable financing bonds to finance or refinance funding it provides to its member councils and council-controlled organizations, together the Borrowers. The net proceeds of those sustainable financing bonds will be notionally allocated to a pool of sustainable loans advanced to the Borrowers, comprising: i) green and social loans, or GS Loans (see Green and Social Loans – Lending Programme Criteria below); and ii) Climate Action Loans (CALs;1 see Climate Action Loans – Lending Programme Criteria below), together the Sustainable Loans. We are confident that LGFA is well positioned to issue sustainable financing bonds and use proceeds from the bonds to originate GS Loans and CALs under its GS Loan Criteria and CAL Criteria, respectively. We have assessed the Framework, based on the proceeds-based pillars of general market standards for sustainable finance, as overall aligned with the impact and transparency principles that underpin the sustainable finance market.

Furthermore, we have assessed the components of the Framework as credible and that LGFA’s criteria for assessing the eligibility of loans under the Framework will direct funds to Sustainable Loans that are expected to provide overall positive environmental and social benefits.2 Additionally, we have assessed the principles of impact and transparency that underlie the sustainable finance industry and many of its norms and standards as applicable to the sustainable financing bonds that LGFA intends to issue, and that LGFA’s internal processes and the use of funds overall aligns with said impact and transparency principles.