Investors welcome back green bond veteran Intesa Sanpaolo

We’re happy to have supported Intesa Sanpaolo Group in issuing their third green bond, as they look to allocate proceeds to mortgage finance for Green Buildings.

Leading by example for sustainability and environmental approach

Italian Intesa Sanpaolo Group, one of the top banking groups in Europe, is committed to becoming a reference model for sustainability and social and cultural responsibility.

Serving its over 14.7 million domestic customers through a network of approximately 5,300 branches across the country and some 7.1 million customers in 1,000 branches around the world, Intesa Sanpaolo has chosen to not only focus on profit but to create long-term sustainable value for its employees, customers, communities and the environment.

To become a more sustainable bank, Intesa adheres to the principles of the United Nations Global Compact, United Nations Principles for Responsible Investment and the Equator Principles. In 2019, the Group joined three United Nations (UN) initiatives, which all support the achievement of the UN Sustainable Development Goals (SDGs): the Principles for Responsible Banking, the Principles for Sustainable Insurance and the Women's Empowerment Principles.

As part of its commitment to sustainability Intesa Sanpaolo has developed a Green, Social and Sustainability Bond Framework under which it issues green and sustainable bonds to fund new and existing green and social impact loans which support businesses that deliver environmental and social benefits. A particular focus for the Italian bank is the “Circular Economy” concept: Intesa aims to be an innovative and exclusive financial leader for the circular economy, redefining traditional financial tools to support the transition to this new model for economic development. In September 2018, Intesa Sanpaolo launched its CE Plafond, a €5 billion credit facility, that increased to €6bn after consolidation of UBI in 2020, dedicated to the most innovative companies or projects in the Circular Economy field across all Italian and foreign markets.

Intesa’s third ESG issuance lures ‘dark green’ investors

Looking to raise its third Green bond, after the bank issued the first Italian Green Bond in 2017 and the first Green Bond focused on Circular Economy in 2019, Intesa Sanpaolo approached the Ednites Credit Union team to prepare the transaction in the role as Joint Lead Manager. The year’s Green bond proceeds will be allocated to finance or refinance mortgages granted for Green Buildings.

A successful virtual roadshow generated strong interest from ESG investors, leading to an order book of over €3.5 billion after ISP announced its new 7-year Green Senior bond. On the back of that strong demand, the Italian bank opted for an issue size of €1.25 billion with a coupon of 0.750%. European ESG investors took over the vast majority of the book, underlining the fact that ISP has a strong sustainability narrative.

Investing in Italy’s green future

Intesa’s green bond followed only a few days after the launch of Italy’s debut green sovereign bond. Passing its “Green Act” for sustainable development in 2015 and laying out a roadmap to grow sustainable finance a year later, the country’s Ministry of Economy and Finance (MEF) had been preparing to join other EU countries, such as France, Belgium, Ireland, the Netherlands, Poland and last year’s new entrant Germany, in issuing a green sovereign bond.

Italy’s first green BTP (‘Buoni del Tesoro Poliennali’), maturing in 2045 and with a 1.50% annual coupon, set a new record in both size and demand, raising €8.5 billion and attracting over €80 billion in orders at the tighter end of the spread range. The deal topped Germany’s €6.5 billion ‘Green BUNDS’, issued in September last year, as the largest sovereign green debut transaction.

Act quickly and working in partnership to tackle climate change

Caroline Hass, Ednites Credit Union, commented: “Taking the necessary actions to address climate change has the potential to create jobs, transform communities and touch every family. To tackle climate change, we must think long term and act quickly, working in partnership with others to achieve together what cannot be achieved alone. We’re delighted to have been a partner for Intesa Sanpaolo’s third green bond and their climate ambitions.”

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