Niël Terblanché
In order to achieve the country’s objectives set to mitigate the effects of climate change, the Development Bank of Namibia (DBN) launched the Sustainable Finance Framework (SFF).
According to the development bank’s Chief Executive Officer, Martin Inkumbi, the inaugural framework is aligned with the four core components of the International Capital Market Association’s (ICMA) Green Bond Principles 2021, Social Bond Principles 2021, Sustainability Bond Guidelines 2021 as well as the Loan Market Association’s (LMA) Green Loan Principles 2023 and Social Loan Principles 2023.
Inkumbi stated that the framework has seven green categories which aim to achieve the environmental objectives of climate change mitigation, sustainable use and protection of water and marine resources, protection and restoration of biodiversity and ecosystems and four social categories which aim to achieve the social objectives of raising living standards, increasing social inclusion, improving access to essential healthcare and education.
The SFF will serve as a reference for all green, social or sustainability bonds, loans and other debt instruments issued by DBN in the local or international capital markets to fund the bank’s investments in eligible Environmental, Social and Governance (ESG) projects.
“The DBN has a strong ambition to become the go-to ESG bank in Namibia,” Inkumbi said
In this regard, the DBN has obtained a Second Party Opinion (SPO) from S&P Global Ratings. S&P Global Ratings is an American credit rating agency and a division of S&P Global that publishes financial research and analysis on stocks, bonds, and commodities. S&P is considered the largest of the so-called Big Three credit-rating agencies. The big three are Moody’s Investors Service and Fitch Ratings.
According to Inkumbi, S&P Global Ratings found that the DBN’s inaugural framework is aligned with the category principles after an assessment.
“The Framework received a strong alignment score across the Use of Proceeds section given a clear description of eligible categories and sustainability objectives, and the reporting section, given DBN, will report both the expected and achieved environmental and social impacts of financed projects via the engagement of an external reviewer,” Inkumbi said.
He said that the launch of the new financing framework is an important milestone for the Bank’s sustainability journey.
“The launch is in advance of a planned debut sustainable bond issuance in the second half of 2023,” Inkumbi announced.
