The framework has been simplified and aims to reflect the latest market standards. The framework is in alignment with the ICMA Green, Social and Sustainable Bond Principals and the EU taxonomy. The structure of the framework follows ICMA’s four key pillars – use of proceeds, process for project evaluation and selection, management of proceeds, and reporting.
The Sustainable Funding framework enables the bank to clearly define what loans of the bank’s loan portfolio can be considered Sustainable. This further enables the bank to issue green and sustainable bonds as well as the use of green deposits in the bank’s funding. Íslandsbanki first published a Sustainable Framework in 2020. Since then, the criteria and provisions of what the market considers sustainable have changed, and the scope narrowed. It is important for the bank to update the framework to ensure that it meets the strict criteria of the market and investor conditions. One of Íslandsbanki’s main drivers is to be a positive force in society. It aims to be a leader in sustainability and tries to encourage Icelandic companies to move forward with their sustainability goals.
Sustainalytics, a leading international Second Party Opinion provider, has reviewed the framework and provided the bank with a confirmation that the framework is according to market practice. Swedbank AB acted as a Structuring Adviser on the framework.