There is an increase in opportunities to deliver sustainable and impactful investment expertise to our clients and stakeholders across a broad range of growth themes.
As a first step in that effort, we have established a sustainable finance business unit, the first of its kind in Africa. The unit is responsible for partnering with our businesses to better serve our clients, drive innovation and capture emerging opportunities as sustainable growth becomes increasingly important for investors, institutions and companies globally.The unit concluded a number of deals in 2019, including:
Standard Bank role: sole arranger and lender
Acorn Project (Two) Limited Liability Partnership
KES4.26 billion – Fixed rate series of I green bonds
Standard Bank role: Lead arranger and placing agent
Impact: Construction of student housing. Edgecertified green buildings.
Federal Republic of Nigeria
NGN15 billion – 14.5% Series II green bonds
Standard Bank role: Joint financial advisor and book runner via Stanbic IBTC Capital
Impact:Green projects aimed at addressing climate change
NSP – SPV PowerCorp Plc February 2019
NGN8.5 billion – 15.6% Series of I green bonds
Standard Bank Role: oint issuing house and receiving bank
Impact:Re-finance existing debt, acquired 30MW Gurara hydropower plant, rehabilitation of overhead cranes and systems/control upgrade
Standard Bank Group’s Sustainable Bond Framework allows us to issue sustainable, green and social bonds that support Standard Bank’s lending to green projects aimed at mitigating climate change, and social projects reducing economic and social inequality. The framework will be reviewed by an independent party, with experience and track record in issuing Second Party opinions. This opinion will be made available to investors on the group’s investor relations website.
Standard Bank will allocate the net proceeds of the sustainability bonds issued under this framework to an eligible loan/asset portfolio of new and/or existing loans/assets within categories aligned to our SEE impact areas. The eligible loans/assets will be funded in whole or in part by an allocation of the bond proceeds.
Final approval of selection and evaluation of projects eligible for green, social or sustainable bonds lies with the group asset and liability committee.
Banks and corporates face a growing demand from shareholders, customers, investors and other stakeholders, for their trade finance transactions to actively support the production of goods or services in a manner that minimises adverse environmental and social impacts and promotes environmental and social benefits.
Standard Bank has been working with the International Chamber of Commerce (ICC) Banking Commission, co-leading a working group tasked with equipping banks to encourage sustainable finance trade practices.
Standard Bank’s commitment to the ICC Banking Commission’s sustainable trade finance process dovetails with the aims of the African Union’s Agenda 2063 which highlights the need for trade and investment infrastructure to connect Africa. As an African bank clear in its purpose to drive Africa’s growth, partnering with the ICC to develop standards and rules in trade, in general, and universally adopted global best practice in sustainable trade finance specifically, supports our purpose to facilitate trade and investment flows between African countries, and between African countries and global markets in a way that promotes sustainable and inclusive economic growth.
Standard Bank supports the expansion of affordable renewable energy solutions across Africa. We work with governments, renewable energy companies and development finance institutions to facilitate large-scale infrastructural development.
Over the past several years we have significantly increased the proportion of our energy loan book committed to green energy and decreased the proportion of finance committed to fossil fuels.
Since 2012, we have financed the construction of new power projects to the value of $2.77 billion in Africa. 86% of this funding was for renewable energy. Lending to fossil fuel power projects represented 14% of our investments (12% Natural Gas and 2% Heavy Fuel Oil, 0% coal). We have not financed any new coal fired power stations since 2009.
GREEN – Annual cumulative underwrite (USD BN) from 2012 – 2019 of project finance power generation transactions directed towards green energy. This includes clean, non-polluting and renewable energy sources that are naturally replenished over time, e.g. solar or wind.
BROWN – Annual cumulative underwrite (USD BN) from 2012 – 2019 of project finance power generation transactions directed towards brown energy, derived from conventional fossil-fuel based energy sources that release pollutants during processing and are finite/not replenished over time, e.g. coal, oil or natural gas.
|Construction (direct)||6 264||2 719||4 116||13 099|
|Construction (supplier)||3 530||994||2 900||7 424|
|Construction total||9 794||3713||7 016||20 523|
|Operations (direct)||673||117||715||1 505|
|Operations total||786||130||760||1 676|
|Total jobs||10 580||3 842||7 776||22 199|
Macroeconomic assumptions from Department of Energy Integrated Energy Plan
Average capacity factors from statistics of utility-scale solar PV, wind and CSP in South Africa in 2017 by CSIR Energy Centre
Average household electricity consumption sourced from Exon Consulting –How much electricity does my home use, August 2016
We work with our clients to adopt greener solutions for their homes and businesses.