Crédit Agricole CIB demonstrated its global capabilities and expertise in sustainability for Hong Kong clients last year, structuring and executing several transactional firsts as well as supporting the growth and development of the broader market.
AfE 2024
A key development was the formation of a new environmental, social and governance advisory team, set up to support clients in their sustainable transition with expert advice and guidance, together with ESG rating analysis.
This was the type of support Fubon Bank (Hong Kong) drew on in executing its first green repo – a $50 million transaction with the cash leg of it used to finance or refinance the bank’s green loans to renewable-energy projects and green buildings.
Crédit Agricole was green structuring adviser and counterparty on the transaction, which supports Fubon’s net-zero ambitions.
Importantly, this transaction and four others across different asset-classes and areas helped support Hong Kong’s status as a financial hub for sustainable finance in Asia and worldwide.
The first was the Hong Kong Mortgage Corporation’s triple-tranche, jumbo social bond issue, which at over $2.5 billion equivalent – across the Hong Kong dollar, renminbi and dollar tranches – is the largest transaction in this format in Asia.
Like the HKMC’s first social bond issuance in 2022, the proceeds will mainly be used to finance or refinance the loans under the Special 100% Loan Guarantee of the small and medium-sized enterprise financing guarantee scheme, which was launched in April 2020 to alleviate the cash-flow pressures of SMEs in Hong Kong during the Covid pandemic.
Crédit Agricole was one of the joint structuring banks on this transaction, as well as joint global coordinator, lead manager and bookrunner.
The French bank’s other standout sustainable-focused deals include two for the Hong Kong government: an eight-tranche $5.75 billion equivalent green bond issue in May; and its pioneering, debut tokenized green bond.
The conventional green bond was the largest by the issuer and the largest multi-tranche bond in this format in Asia Pacific, while the HK$800 million ($102 million) tokenized green bond is the first by a government issuer globally.
Away from the capital markets, Crédit Agricole also innovated on the liability side of its balance sheet in structuring and launching the first-of-its-kind ESG-linked deposit product.
Designed for New World China and NWS Holdings, the product incentivises the companies to improve their ESG performance by linking the deposit rate to their sustainability performance.