Reporting of bond issues: €22.48bn Sustainable and Climate loans for €13.35bn in SDG bond issuances as of 31 December 2022

Since 2020, AFD has given priority to sustainable issuance in order to reflect the significant overlap of environmental and social impacts with its action aimed at supporting the just transition. In 2022, investors continued to express their confidence by subscribing for €4.5Bn of our sustainable development bonds, a 25% increase compared to the previous year. These sustainable borrowings represented half of our annual programme.

The funds raised from financial markets must be allocated in accordance with the Sustainable Development Goals bond issuance guidelines drawn up in 2020 and reviewed by Moody's ESG Solutions (previously Vigéo). AFD has initiated a revision of its sustainable issuance framework to reflect updates to its strategy and internal developments, as well as to contribute to the new standards and practices of the sustainable debt market, with a view to publication in early 2024.

Contribution to the UN’s Sustainable Development Goals and portfolio breakdown

Eligible loans must address one of AFD’s six transition categories (including demographic and social, economic and financial, territorial and ecological, to name a few). Additionally, they must display positive or neutral SDG interactions. This selection process is based on a key, innovative tool in AFD's evaluation system, sustainable development analysis and advice.

As of 31 December 2022, the ten SDG and Climate bonds amounted to €13.35 billion. They face 669 loans, for an outstanding amount of €17bn allocated to the Sustainable loans portfolio and €5bn to the Climate loans portfolio. The main five goals to which the SDG bonds contribute are gender equality (SDG #5), decent work and economic growth (#8), climate action (#13), peace, justice, and strong institutions (#16) and partnerships for the goals (#17).

All eligible loans have a social impact and 85.3% have an environmental impact

For instance, 124 of these loans support the development of renewable energy worldwide, resulting in the avoidance of 913 million tonnes of CO2 per year and enabling 4.3 million people to be connected to the electricity grid. Moreover, 26 loans in the healthcare sector are contributing to the enhancement of healthcare accessibility for 63.6 million people.

“This reporting is an opportunity to show that the environmental projects we support also have social impact, emphasises Samia Ben Mebarek. We do not distinguish between the two in our bond issues, because as a development bank, we bring both aspects into play when we appraise projects aspects, in line with the Group's 100% Paris Agreement, 100% socially responsible strategy”.

The report and auditor's review can be found here.

 

Contact: _AFD_Funding@afd.fr

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