It will allocate RD$300 million to expand its portfolio of sustainable loans
SANTO DOMINGO.– Banco Popular Dominicano will issue the first tranche of its green bond this Tuesday, May 28. Approved by the Superintendency of the Securities Market (SIMV), the proceeds will be used to finance or refinance loans in its green portfolio, expanding its reach and reinforcing the financial institution's commitment to supporting Dominican society in its transition to a low-emission economy.
This first tranche of the green bond will be RD$300 million, out of a total of RD$2,500 million approved, and will be allocated entirely to institutional investors, specifically to the pension fund administrators (AFP) Popular, Crecer, Siembra and Reservas.
Specifically, the tranche placed will have a maturity of 10 years and will accrue a fixed annual interest rate in Dominican pesos.
In January 2024, the bond issuance program received the highest rating of AAA from Feller Rate, recognizing it as an investment instrument with the highest capacity to repay principal and interest. In April, Fitch Ratings rated the issuance AA+(dom).
This green bond also obtained Climate Bonds Initiative (CBI) certification in its version 3.0 and received a positive opinion from Pacific Corporate Sustainability (PCS), which prepared a limited independent assurance report, in which it assessed the compliance of this issue with the CBI 3.0 standard and with the Green Bond Principles of the International Capital Market Association (ICMA).
Eligible projects
Banco Popular will channel these funds toward green projects with clear environmental benefits, in accordance with the requirements of circular C-SIMV-2020-02-MV for sustainable, green, and socially responsible public offerings. These projects may involve renewable energy, energy efficiency, sustainable mobility, and the circular economy.
Similarly, the banking entity will also be able to finance activities approved by the SIMV within the framework of the Green Taxonomy, a document that will classify the activities and assets that contribute to the mitigation of climate change and adaptation to its effects in the country.
Pioneering green bond
This green bond from Banco Popular is the first issued by a Dominican financial institution under the guidelines of the SIMV (Mexican Securities Market Commission). The first sustainable public offering by a Dominican company was placed in December 2021, which was also structured with the advice of Banco Popular's Investment Banking team.
In this regard, Christopher Paniagua, CEO of Banco Popular, expressed his satisfaction that the financial institution continues to expand its scope of action in the country to encourage a lower-emission and more sustainable economy.
“This green issuance strengthens our leadership in continuing to promote sustainable development in the nation, aligning the banking business with the Sustainable Development Goals, the 2030 Agenda and the National Adaptation Plan for Climate Change in the Dominican Republic, fulfilling the commitment we made in 2019 with the United Nations Principles for Responsible Banking,” said the banking executive.
Popular's green portfolio, which includes financing in the country's main clean energy parks and a portfolio of sustainable products called "Hazte Eco" for families and businesses, currently stands at RD$40,055 million.
