NatWest adds new label in ESG debt with ‘women-led’ bond
THE NatWest Group is selling a 500 million euro (S$720.1 million) bond to finance women-led businesses, bringing another label to the growing array of ESG (environment, social and governance) bonds in the market.
The UK lender got orders for the deal significantly above the fixed-size 500 million euro offering, said a source on condition of anonymity. A spokesperson for the UK lender said it is the first social bond from a European financial institution where the proceeds are dedicated to funding loans to women-led enterprises.
Final terms for the bond, which matures in March 2028, showed pricing at 120 basis points above the mid-swap rate, the source said.
The women-led language follows other so-called “gender” bonds, such as two issues last year from the Asian Development Bank – one in sterling and one in Norwegian kroner – which included a framework for lending toward projects that address “dimensions of gender equality and women’s empowerment”.
The offering comes after a year in which sales of green, social, sustainability and sustainability-linked bonds recorded their first decline. Issuance of social bonds had the biggest decline across all the labels – dropping 34 per cent to about US$141 billion.
Higher borrowing costs – hitting all types of bonds – as well as heightened scepticism about ESG labels turned some borrowers away, with increasing scrutiny about how issuers’ claims match up with reality.
NatWest said in an e-mail that it will report on the impacts and outputs from all of its social and green bonds in April, and will include details and case studies of today’s issuance at the same time.
The lender is one of just a handful in Europe’s main index of banks to be led by a woman, Alison Rose, and has a target to have full gender balance in its top three management layers globally by 2030, said its 2022 annual report. BLOOMBERG
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