NAB taps offshore green bond market for 1.1GW of solar, wind

National Australia Bank has broadened its renewable energy investment reach to the European, US and UK markets, with the issuance this week of a €500 million ($A690 million) green bond, targeting what the bank describes as “strong investor demand” for solar and wind energy projects.

The bond, issued on Thursday, will refinance renewable energy and low carbon transport projects and assets in the UK, Europe, Australia and the Americas, including wind and solar energy assets with an expected installed capacity of more than 1GW.

It is the third bond of its kind to be issued by NAB, but marks the first issuance of an offshore green bond by an Australian bank, and the biggest ever green bond from an Australian issuer.

And it takes the bank’s total funds committed to the financing of renewable energy generators, globally, to more than $1 billion since October 2016, the bank says.

In 2014, NAB became the first Australian lender to jump into the booming green bond market, with the issue of a certified $150 million climate bond targeting a portfolio of 17 wind and solar projects.

As we reported here at the time, the largely renewable-focused exercise was a huge success, with strong investor demand doubling the size of the bond to $300 million within hours.

NAB it says its second green bond was also met with strong investor demand, and the order book well oversubscribed.

NAB head of capital financing Steve Lambert said the bank was not only responding to strong consumer demand for “impact investment” options, but was stepping up its role as a major financier of the renewable energy generation of the future.

“NAB’s focus on shared value and impact investment means we are able to provide choice, allowing investors to invest in ways that meet their own environmental criteria,” Lambert said in comments on Thursday.

“We also recognise the important role we play in funding projects that secure energy needs now and into the future and we take very seriously the role we play in in transitioning to a low carbon economy.

NAB Group Treasurer, Shaun Dooley, said this latest green bond would broaden the bank’s investor base, and in particular provide access to the huge Eupopean green bond market, that is estimated to exceed €60 billion.