HSBC secures six bond awards
HSBC secured six Environmental Finance Bond Awards categories in 2022, revealing the high regard in the market for its structuring and engagement work across green, social and sustainability bonds during 2021.
HSBC EMEA and Americas sustainable bonds head Anjuli Pandit said the sustainable fixed income success of the bank is driven by its broader focus on sustainable processes rather than labelled transactions.
"We really try to understand quite deeply where the client's coming from, and we try to piece it all together – we are not just pitching ESG instruments. It is not uncommon for me to meet a client and spend two hours convincing them that they should not do an ESG bond, explaining why and how they can use other solutions."
That means when discussions turn to specific sustainable bond issuances, HSBC is able to connect issuer and investor needs – a strength applauded by one EF awards judge.
Pandit said HSBC's international reach allows it to take a "balanced and practical" view that is both "fair to the market and the issuer".
"We won't take a solely EU Taxonomy-focused view because, for the majority of our clients around the world, it is not achievable or is even too limiting in relation to what is considered 'green' for their business. But, at the same time, we want to be one of the top banks in sustainable investing, and therefore we need to push towards the highest standards and move the market to as close to best practice as possible."
HSBC's wins include three sustainability bond Lead manager of the year awards.
HSBC ESG solutions head Farnam Bidgoli said that the critical aspect of sustainability bonds – a green and social bond hybrid – for issuers is their flexibility which allows them to "streamline and simplify the process of issuing sustainable finance [products] by bringing the different aspects of ESG together".
With pressure building on green bond issuers to demonstrate commitments to a 'just transition' and social bond issuers to demonstrate net-zero alignment, the sustainability bond appeal looks set to strengthen.
In this regard, HSBC sustainable bonds associate Shradha Agrawal highlighted HSBC's work on the debut sustainability bond from healthcare property firm Assura in June.
"This is a pure-play social issuer. They had a social framework at first – which HSBC also helped structure – and then they decided to actually go from social to sustainability bonds to highlight their green elements which, I think, resulted in a portfolio which was unique and truly sustainable. So there are examples in the market where borrowers issuing a social bond add a layer of green to demonstrate their ambitions to reach net zero."
HSBC also secured the sustainability bond lead manager awards for supranational, sub-sovereign and agencies (SSAs) and corporates in 2021, but its financial institution win was new for 2022. Indeed, Bidgoli was particularly proud of HSBC's work on sustainability bonds from financial institutions such as Vienna Insurance, Just Group and Turkish institutions including Ziraat Bank, Akbank, and Kuveyt Turk.
HSBC also picked up the financial institution green bond Lead manager of the year award, and Pandit expects 2022 could prove interesting for financial firms in the sustainable bond space.
"2021 has been a focus year for sustainable accounting and reporting for financial institutions," she said – pointing to the Net Zero Banking Alliance launch in May and the accelerating work of the Partnership for Carbon Accounting Financials.
"We are now benefitting from the hard work that has been done [understanding their balance sheets] in 2021, and during this year the market will see a lot of updates and enhancements to frameworks."
HSBC also won the Lead manager of the year award for local authority/municipal green bond issuances as well as SSAs social bond issuances. With the social bond market, Pandit said HSBC is keen to motivate the market –particularly, sustainable investors – to not squander the progress it made in response to the Covid-19 pandemic.
HSBC's 2022 Environmental Finance Bond Awards:
- Lead manager of the year, green bonds – financial institution
- Lead manager of the year, green bonds – local authority/municipality
- Lead manager of the year, social bonds – supranational, sub-sovereign and agency (SSA)
- Lead manager of the year, sustainability bonds – corporate
- Lead manager of the year, sustainability bonds – financial institution
- Lead manager of the year, sustainability bonds – supranational, sub-sovereign and agency (SSA)