National Bank of Abu Dhabi $587 million 3% green bond issue

Overview:

• National Bank of Abu Dhabi (Nbad) sold a €587 million green bond in what was the first instrument of this type issued by an entity in the Middle East. 
• The notes, which are listed on the London Stock Exchange, have a coupon of 3% and mature in March 2022.
• Proceeds from green bonds must be used to invest in environmentally friendly projects.  
• Low conventional energy prices have encouraged Abu Dhbai to invest in developing its renewable energy production capacity, and Nbad, one of the emirate's state controlled lenders, announced in January 2017 its intends to provide $10 billion in financing over 10 years for sustainable energy projects.  
• Nbad first marketed the region's debut green bond in August 2016 but lukewarm interest from investors, unconvinced by the pricing, saw the bank postpone the issue.  
• Nbad resurrected the bond after it completed its $175 billion merger with First Gulf Bank, which, prior to closing, had made pricing the green bond difficult.  
• HSBC and Nbad were joint structuring advisers on the bond and, together with Bank of America Merrill Lynch, Citigroup, Credit Agricole, and Mitsubishi, joint lead arrangers.

Ben Nyalor - Regional editor