Whilst significant steps have been taken in recent years to mitigate the speed and extent of climate change, efforts in this regard need to be accelerated. The transition to a green economy will play a very important role in this process, with the finance industry leading the way.
Once a fringe investment, green and sustainable finance principles have risen to become standard practice within global lending markets. As national and regional regulations are starting to come into force (supplemented by voluntary initiatives), we can support you with staying on top of the developments shaping this fast changing and rapidly expanding landscape.
How we can help
Our international finance team advises borrowers, lenders, issuers, private equity sponsors and investors on all aspects of green and sustainability linked financing, including green social and sustainability-linked loans; sustainable, green or social bonds; derivatives and structured finance and the financing of renewable projects.
We advise on the implementation of the LMA's Green Loan Principles, Social Loan Principles and Sustainability Linked Loan Principles (taking account of relevant guidance, such as the LMA's "green buildings" and "retrofit" guidance), and the use of the ICMA's Sustainability Bond Guidelines and the Social Bond Principles. We also assist on navigating regulatory and disclosure requirements.
Whether the transaction involves a loan for the development of a waste recycling centre, supporting a borrower committed to improving its sustainability credentials or issuing bonds to fund the acquisition of a renewable energy plant, we are well placed to assist.
Our finance group comprises of specialist teams across different sectors meaning we are able to advise on specific green or sustainable finance initiatives in your particular sector. Examples of how this sector-specific approach could help you include:
- advising real estate finance lenders financing landlords needing to retrofit existing buildings to comply with MEES regulations;
- advising shipping lenders on the use and implementation of the Poseidon Principles;
- exploring how the CORSIA carbon offsetting scheme can be used by the aviation industry to qualify for green/sustainability led finance;
- working alongside lenders in the transport sector to support the Campaign for Better Transport's recommendations for a post COVID green-recovery programme.
To view our green shoots: the rise of the green finance revolution publication, which explores the approaches being taken by the finance industry in making this transition, and sets out views on future steps needed in order to promote even further growth in the green finance sector across a number of the different areas in which we operate: capital markets, real estate finance, ship finance, aviation finance, rail finance and leasing, please click here.
Experience
For our experience relating to ship finance, also refer to our clean shipping section.
Vigeo Eiris' certified green loan
We advised a European bank on the structuring and documentation for a green loan. The green loan was made available after Vigeo Eiris, an independent international ESG research provider, confirmed compliance with the four core components of the LMA's Green Loan Principles (GLPs). A key part of the financing was the agreement around the green loan infrastructure and the related representation and undertakings. These included discussion around the LMA’s GLPs, the third-party verification opinions, the green loan framework, the green loan reporting obligations and the Poseidon principles.
Green loan for European Bank
We are currently advising a European bank on a loan complying with the Green Loan Principles and the Climate Bond Initiative as certified by independent expert DNV Business Assurance Services UK Limited. The loan will include various green events of default, as well as a margin adjustment depending on the borrower's compliance with some green covenants.
Green loan for Asian bank
We are currently advising an Asian bank on a green loan which will allow the borrower to purchase vessels eligible under a green finance framework which is aligned with the Green Loan Principles.
ING US$126 million financing
We advised ING Bank NV., Singapore in relation to a K-SURE backed loan which included margin ratchets based on various KPIs.
A European bank
Advising on amendments to their template term sheets and facilities to include green finance provisions.
BNP Paribas
Advised on the structuring and documentation for a green loan. The green loan was made available after Vigeo Eiris, an independent international ESG research provider, confirmed compliance with the four core components of the LMA's Green Loan Principles (GLPs). A key part of the financing was the agreement around the green loan infrastructure and the related representation and undertakings. These included discussion around the LMA’s GLPs, the third party verification opinions, the green loan framework, the green loan reporting obligations and the Poseidon principles (a global framework which ensures responsible ship finance portfolios).
Swire Pacific Offshore
Advised a subsidiary of Swire Pacific Offshore in connection with stainability linked loans made to a company that owns and operates state-of-the-art turbine installation vessels. The loan included a margin ratchet linked to the achievement of certain agreed ESG criteria and was certified by CICERO.
Zenobe Energy Limited
Advising Zenobe Energy, one of the UK’s largest independent owners and operators of battery storage, on innovative and strategically significant funding, securing up to £20 million of contracted receivables funding from NatWest to support the company’s growth plans in the Electric Vehicle sector.
KfW IPEX-Bank
Advising KfW IPEX-Bank in respect of the US$72 million GIEK backed fleet exhaust gas cleaning system retrofit financing for Quantum Pacific Shipping. The deal was named ‘Green Ship Finance Deal of the Year – East’.
An international bank
Advising an international bank on a US$48 million green loan financing.
Peace Boat NGO
Advising Peace Boat on the acquisition and financing of a cruise ship from Royal Caribbean. Peace Boat is a Japan-based international NGO which promotes peace, human rights, and sustainability. Established in 1983, it holds Special Consultative Status with the Economic and Social Council (ECOSOC) of the United Nations (UN).
Green real estate development loans
Advising a newly established fund for residential development loans, including advice on green loans.
An international bank
Advising on a proposed loan to a fund set up to buy office buildings and develop them to make them more energy efficient.
An investment manager
Equity bridge financing for an investment manager dedicated to sustainable investing.
A commercial real estate company
Advising on green bond issues.
A vehicle leasing company
Advising on a sustainable bond issue for a vehicle leasing company based on based on financing pools of electric cars.
Impax Asset Management (Hong Kong) Limited
Assisting the client, an SFC-licensed asset manager, to obtain a waiver from the SFC of a condition imposed on its securities licences.
An international leasing company
Advising on a green loan to finance green railcars.
