Absa Corporate and Investment Banking (CIB) has established itself as a pioneer in the sustainable finance sector by securing the initial investment in its first-of-its-kind Absa Green Deposit.
The Absa Green Deposit is a novel investment product that allows South African corporations to invest in a product that provides an attractive yield while also aligning with the Environmental, Social, and Governance (ESG) and Sustainable Development Goals (SDGs) and those seeking to deliver positive social impact.
Enel Green Power RSA, the renewables company of the Italian electric utility Enel S.p.A, made the first investment.
The monies collected through the Green Deposit products will be linked to a ring-fenced portfolio of approved green assets. This initial tranche of funding will be used to finance or re-finance an equivalent amount of renewable energy projects.
“As we continue to face the effects of climate change, it is crucial that we take action towards sustainable living and one of the ways we can contribute to this cause is by supporting green financial products that are designed to finance eco-friendly projects and businesses, such as renewable energy, waste reduction, and conservation efforts,” says Thabo Makoko, Head: Cash Management Africa, Transactional Banking.
Msizi Khoza, Absa CIB Head of ESG (Environmental, Social and Governance) adds: “Absa continues to be a market leader in developing fit-for-purpose ESG products that address complex client needs. As the world of sustainable finance and ESG investing evolves, we believe that we will differentiate ourselves through innovation and technology.”
The deposit solution’s “Green” labelling is consistent with the eligibility criteria set out in the Absa Sustainable Finance Framework and based on international market guidelines. This framework is an enabling document for the bank to issue green, social, and sustainable use of-proceeds liabilities.
“Our mission is to enable progress with sustainable energy. Innovative solutions, such as the Green Deposit, that are progressive and geared towards sustainability support our vision to create shared value and lasting impact on our journey towards a decarbonized future” says Manuele Battisti, Country Manager Enel Green Power South Africa.
Makoko concludes: “Investing in green financial products is not only a responsible financial choice for our planet but also a smart financial decision that will create a more sustainable future for ourselves and future generations.”
