Financial services company Fifth Third announced today it has completed the issuance of its inaugural $500 million green bond, becoming the first U.S financial institution under $250 billion in assets to issue an ESG bond of any type.
The new bond will fund green projects that align with the Company’s sustainability priorities outlined in its Fifth Third Bancorp Sustainability Bond Framework, in areas including green buildings, renewable energy, energy efficiency and clean transportation. The bond is aligned to the Green Bond Principles published by the International Capital Markets Association for use of proceeds, process for project evaluation and selection, management of proceeds, and reporting.
The offering comes as companies worldwide are turning to sustainable finance tools to support ESG-related projects. A recent report from Moody indicated that green bond issuance in the first three quarters of 2021 soared to a record $380 billion, up 75% year-over-year, and estimated that sustainable bond issuance for the year will exceed $1 trillion for the full year.
Today’s announcement also follows a series of other recent sustainability and climate-focused initiatives by Fifth Third. In April this year, the company announced it has joined the Partnership for Carbon Accounting Financials (PCAF). In January, the bank announced that it had reached carbon neutrality in its operations, and in September 2020, Fifth Third launched a new commitment to achieve $8 billion in sustainable finance by 2025.
Jamie Leonard, executive vice president, and chief financial officer, Fifth Third Bancorp.
“With the issuance of our inaugural Green Bond, we are aligning our financing with our investment and lending priorities and extending our leadership in environmental sustainability. Our Green Bond enables us to provide liquidity to our customers in their transition to a sustainable future as well as additional investment opportunities to our investors to meet their investment objectives.”
The offering was led by J.P. Morgan Securities LLC, Fifth Third Securities, Inc., and Citigroup Global Markets, Inc. and co-managed by minority and/or veteran-owned firms, including Academy Securities; CastleOak Securities, L.P.; R. Seelaus & Co., LLC; and Siebert Williams Shank & Co., LLC.