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Matheson advises on first Irish Bank Green Bond

AUTHORs: Richard Kelly, Finance and Capital Markets Date: 02/10/2020

Matheson is pleased to have advised the joint lead managers and co-manager on the issuance of €1 billion in green bonds by AIB Group plc (“AIB”) on 30 September 2020.

A green bond is a debt security issued by an entity the proceeds of which are intended to finance projects or assets that will benefit the environment.  The development of the green bond market is seen as an important step in the wider trend of prioritising environmental, social and governance (“ESG”) considerations in investments.

AIB’s green bonds are in the form of Tier 2 (ie subordinated) capital and are governed by Irish law.  The proceeds of the green bonds will be used by AIB to support lending towards renewable energy generation and storage projects, green commercial buildings and green residential buildings.

This landmark transaction is the first time an Irish bank has issued green bonds and AIB is only the second European bank to issue Tier 2 green bonds after an issuance by the Dutch bank De Volksbank in July 2020.  

The Matheson team advising on the transaction was led by Richard Kelly, partner in Matheson’s Finance and Capital Markets Department, who was assisted by solicitor, Conor McKeown.

Richard Kelly commented: “We are delighted to have contributed to this issuance.  We believe that green finance is instrumental in the transition to a more sustainable economy.  We look forward to advising on more ESG projects in the future.”