NatWest Group Plc is selling a €500 million ($533 million) bond to finance women-led businesses, bringing another label to the growing array of ESG bonds in the market.
(Bloomberg) — NatWest Group Plc is selling a €500 million ($533 million) bond to finance women-led businesses, bringing another label to the growing array of ESG bonds in the market.
The bank, led by Chief Executive Officer Alison Rose, is the first of Britain’s big four lenders to have a female leader. Rose said in an email that today’s bond makes NatWest the first European financial institution to create a social bond specifically designed to lend to women-led businesses.
The women-led language follows other so-called ‘gender’ bonds, such as two issues last year from the Asian Development Bank — one in sterling and one in Norwegian kroner — which included a framework for lending toward projects that address “dimensions of gender equality and women’s empowerment.”
Orders for the deal came in significantly above the fixed-size €500 million offering, according to a person familiar with the matter, who asked not to be identified because they’re not authorized to speak about it. Final terms for the bond, which matures in March 2028, showed pricing at 120 basis points above the mid-swap rate, the person said.
The offering comes after a year that saw the first decline on record for sales of green, social, sustainability and sustainability-linked bonds. Issuance of social bonds had the biggest decline across all the labels — dropping 34% to about $141 billion. Higher borrowing costs — hitting all types of bonds — as well as heightened skepticism about ESG labels turned some borrowers away, with increasing scrutiny about how issuers’ claims match up with reality.
NatWest said in an email that it will report on the impacts and outputs from all of its social and green bonds in April and will include details and case studies of today’s issuance at the same time. The lender has a target to have full gender balance in its top three management layers globally by 2030, according to its 2022 annual report.
–With assistance from Priscila Azevedo Rocha and Jacqueline Poh.
(Updates with comment from NatWest CEO in second paragraph.)
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