Sustainability bond of the year – Local authority/ municipal: Region Ile de France

Channels: Green Bonds

Companies: Region Ile de France, Moody's, Fitch, Natixis, Crédit Agricole CIB, HSBC, Société Générale

Deal highlights:

Issuer: Region Ile de France

Size: €500 million

Maturity: June 2033

Coupon: 1.375%

Use of proceeds: Buildings and equipment for education and leisure, public transportation and sustainable mobility, renewable energy and energy efficiency, biodiversity, social initiatives aimed at helping vulnerable population groups, social housing, economic and socially inclusive development.

Credit rating: Aa2/ AA (Moody's/ Fitch)

Lead manager: Natixis, Crédit Agricole CIB, HSBC, Société Générale

Other highlights/ notable features: Green and Sustainability bond

Region Ile de France marked its commitment to the socially responsible investment market in 2018 by issuing its sixth green and sustainability benchmark, raising €500 million ($588 million). It priced at the tight-end of the guidance, at OATs+20 basis points, helped by an order book in excess of €1 billion, with more than 60 accounts participating.

This 15-year transaction is the longest maturity ever issued by Region Ile de France. Although French buyers snapped up 59% of the paper, it attracted investors from across Europe.

The issuer said the quality of its investor base has improved substantially since its first sustainability issue in 2012.

Proceeds from the bond have been used to finance eligible projects under the existing green and sustainability bond framework in seven key areas:

  • Buildings and equipment for education and leisure;
  • Public transportation and sustainable mobility;
  • Renewable energy and energy efficiency;
  • Biodiversity;
  • Social initiatives aimed at helping vulnerable population groups;
  • Social housing; and
  • Economic and socially inclusive development.

Each project financed by the last green and sustainability bond has been analysed with regards to its positive contribution to the UN Sustainable Development Goals (SDGs). On average, each project contributes positively and directly to 8.5 SDGs.

A detailed explanation of the methodology used to scrutinise each project is presented in the reporting.

Region Ile de France said it will try to further enhance its impact reporting, by linking the project impacts and the SDGs.