BIDV pioneers ICMA compliant green bond issuance

October 26, 2023 | 16:33
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State-owned bank BIDV on October 23 has marked a significant milestone in Vietnam's financial market by becoming the first bank in the country to successfully issue green bonds in compliance with the International Capital Market Association's (ICMA) Green Bond Principles.
BIDV pioneers ICMA compliant green bond issuance

This pioneering issuance, valued at VND2.4 trillion (approximately $101.3 million), sets a new standard in Vietnam's capital market. It's dedicated to funding green projects focused on energy conservation, reducing emissions, and environmental protection, in line with BIDV's Green Bond Framework.

Moody's, a leading international credit rating agency, has bestowed a high rating on the BIDV’s Green Bond Framework, affirming its stringent adherence to project selection, assessment, lending practices, governance, and reporting standards.

Remarkably, this BIDV issuance is Vietnam's first non-collateralised, non-subordinated, and non-guaranteed green bond issuance. This innovative structure demonstrates investor confidence in BIDV's credibility and financial strength. The investor pool consisted solely of insurance companies and fund management companies from world-leading insurance conglomerates.

Tran Long, deputy CEO of BIDV said, “BIDV has a clear strategy towards developing green banking and green credit in line with the demands of accelerating green credit growth and managing Environmental, Social, and Corporate Governance (ESG) risks in our credit activities."

"We are ready to finance clients in low-carbon emission sectors and climate change adaptation. The capital raised from these green bonds will effectively boost BIDV's capacity to implement our strategy. Aligned with the government's commitment to achieving 'net-zero' emissions by 2050, we hope BIDV's pioneering international-standard green bond issuance inspires other institutions to join us in building a robust, sustainable green future.”

Carolyn Turk, World Bank country director for Vietnam said, “This initiative, ahead of COP28, supports Vietnam's climate objectives and contributes towards a livable planet. The World Bank is pleased to support Vietnam's ambitions to achieve net-zero carbon emissions by 2050. The issuance of green bonds by commercial banks like BIDV is pivotal in attaining this goal. BIDV's green bonds will inspire corporations and commercial banks to collaboratively green our economy.”

"Adhering to responsible investment policies, we support global sustainable development initiatives. Our investment team always considers ESG factors, aligning with our company's philosophy and operations," said Ngo The Trieu, CEO of Eastspring Investments.

"Investing in BIDV's green bonds exemplifies Eastspring Vietnam and Prudential Vietnam's commitment to Vietnam's sustainable development goals. We highly value BIDV's role as the first commercial bank in Vietnam to successfully issue bonds following ICMA's Green Bond Principles, along with a Second Party Opinion, affirming the bank's commitment to transparency, trust, and effective capital use," Trieu said.

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