Banco do Brasil (BB), Latin America’s largest financial institution, completed its preparations to enter the market for sustainable bonds and has counted, for that, with the support of the Inter-American Development Bank (IDB). The objective is to seek the synergy between BB’s experience in financing sustainability and the growing international and national appetite for investments that, in addition to financial return, generate social and environmental benefits.
One of the steps prior to the launch of the bonds, the elaboration of a framework, has already been completed. The document guides the issuance of this type of paper and provides guidelines on which types of assets can be classified as sustainable, aligning them with the UN Sustainable Development Goals (SDGs).
Among the highlights of BB’s Sustainable Finance Framework is the inclusion of low-carbon agriculture operations – an approach still little seen nationally and globally. Other elements more common in this market are also contemplated, such as the social aspect, accessibility, health, support to micro and small companies, microcredit, family farming and renewable energy.
The construction of the document had the assistance of the IDB and the support of the company Sitawi Finanças do Bem. In addition, the final version was submitted to the second-party opinion of Sustainalytics, with a favorable opinion.
Internally, Banco do Brasil also approved a Sustainable Finance Model that includes issues of Sustainability-Linked Loans (SLL) and Sustainability-Linked Bonds (SLB).
The issuance of the bonds may occur throughout 2021, on a date to be defined according to the needs of BB and the time of the market, in the modalities of refinancing the loan portfolio and/or financing new projects.