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S&P provides full alignment opinion on QNB’s green bond framework

S&P provides full alignment opinion on QNB’s green bond framework

Tribune News Network
Doha
S&P Global Ratings has said that Qatar National Bank’s (QNB) Green, Social, and Sustainability Bond Framework is fully aligned with the four components of the Green Bond Principles (GBP) and the four components of the Social Bond Principles (SBP), collectively referred to the Sustainability Bond Guidelines.
The Framework Alignment Opinion report is available at QNB’s Green, Social, And Sustainability Bond Framework.
“The full alignment assessment reflects the bank’s commitment to sustainable development, leveraging its capabilities to finance projects that can create a tangible impact where they operate,” said Michael Puli, the primary contact at S&P Global Ratings.
The Green, Social, and Sustainability Bond Framework outlines QNB’s process for project evaluation and selection, providing details about how the bank’s Green, Social and Sustainability Bond Committee approves and oversees the eligible project portfolio.
“In terms of management of proceeds, the issuer commits to track the net proceeds and remove from the portfolio any loan that ceases to fulfil the eligibility criteria,” Puli said.
“QNB intends to report the allocation of proceeds and the impact of the eligible categories based on relevant key performance indicators,” he said.
In a statement released as part of the report, he said, “We regard QNB’s bond framework to be aligned with the use of proceeds component of the GBP and SBP. QNB commits to allocate all net proceeds of bonds issued under its framework to exclusively (re)finance green and social projects. It maintains and regularly reviews a broad exclusions list of fossil fuel energy, weapons and defense, mining, palm oil and others. The framework clearly articulates the category, definition, eligibility, and mapping of financed projects to UN Sustainable Development Goals.”
“QNB’s eligibility criteria for exposures cover green buildings, renewable energy, clean transportation, biodiversity, water, and pollution prevention. These categories address the five environmental objectives of the GBP. For example, financing the construction or renovation of buildings with clear minimum energy saving targets helps to mitigate climate change. Financing organic agriculture, forestry stewardship, sustainable fisheries, and wastewater treatment projects with sustainable credentials supports resource and biodiversity conservation. Social projects focus on the general public, particularly the underserved, via explicit support for five out of the six SBP categories,” it said.
QNB released its first sustainability report in 2018, established its Green, Social, and Sustainability Bond Framework in February 2020, and issued its first green bond on September 22, 2020. It has since updated its framework to expand the use of proceeds (both exclusions list and eligibility criteria) to address issues such as the COVID-19 pandemic.
“QNB’s total verified eligible green portfolio is valued at over $1 billion (less than 1 percent of its total loan portfolio), with projects located in the UK receiving the most funding. We expect the green and social loan portfolio to increase as a proportion of QNB’s lending, given sustainability is a key pillar to its strategy,” it said.

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