AIB raises €750m in latest green bond issuance

The banking group announced the issuance on Tuesday (17 October), confirming that it was more than 100% oversubscribed with a peak investor interest exceeding €1.5bn.

The final order saw 109 investors across 19 countries supporting the bond.

In total, AIB has now issued more than €4bn of green bonds over the past three years, in addition to €1.75bn social bonds.

AIB’s Green Bond Framework is aligned with the International Capital Markets Association’s Green Bond Principles.

It stipulates that proceeds from AIB’s green bonds can be used to finance low-carbon and energy-efficient commercial buildings and residential buildings; renewable energy generation; energy storage; electricity transmission systems, and zero-emissions vehicles and supporting infrastructure.

Proceeds can be used on buildings in the UK and Ireland. For renewable energy and transport funding, projects in the European Economic Area and USA are also eligible.

“Green bonds are a key part of the transition finance toolkit as they enable capital to be directed towards key green and transition activities,” said AIB’s chief executive Colin Hunt, noting the business’s ambition for 70% of its new lending by 2030 to be related to the green economy or activities enabling the low-carbon transition.

Hunt added: “One of AIB’s key strategic priorities is to support the transition to a low-carbon future by reducing our own carbon footprint and helping our 3.2 million customers to do the same.

“The floods and fires we witnessed in Europe and elsewhere this year have reminded us once again of the importance of ensuring a greener tomorrow by backing those building it today, including through major investment in energy and climate action infrastructure.”

Investors pledged $351bn to green bonds issued in the first six months of 2023 – a record high for the first half of any year, according to LinkLaters.

This was positive news following a dip in green and sustainability-linked bond issuance in 2022 for the first time in a decade.

Businesses to have issued green bond packages this year include E.ON (€1.5bn) and Intel ($400m).