- EBRD invests US$ 12.5 million in green bond issued by Khan Bank
- First green bond to be listed on the Mongolian Stock Exchange
- Bond proceeds to support green lending in the country
The European Bank for Reconstruction and Development (EBRD) participated in a green bond issuance by Khan Bank in Mongolia with an investment of US$ 12.5 million (€11.5 million) in the total of US$ 30 million offering.
The first EBRD investment in a green bond in Mongolia will support the first such bond of a local commercial bank to be listed on the Mongolian Stock Exchange. The bond will be issued under Khan Bank’s Green Bond Framework and will be aligned with the International Capital Market Association’s (ICMA) Green Bond Principles. It will help to strengthen Khan Bank’s corporate climate governance and support transparency and integrity in the development of the local green capital market.
The proceeds will be used to support Mongolia’s green drive and help the country achieve its nationally determined contribution related to the reduction of greenhouse gas emissions by 22.7 per cent before 2030.
The Asian Development Bank will make a similar-sized investment in Khan Bank’s green bond.
Khan Bank, the country’s largest commercial lender with 540 branches across the country and the EBRD’s client since 2007, will use the proceeds to finance projects in the sectors of renewable energy, energy efficiency, green buildings and environmentally clean transport to name a few.
This investment shows confidence of international financiers in Khan Bank and supports efforts to diversify its funding base.
To date, the EBRD has invested €2.4 billion in Mongolia’s economy through 145 projects. Around 90 per cent of these funds have been channelled to support private-sector companies.