Allen & Overy advises on first sustainable bond issuance by Banco de Bogotá
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Allen & Overy (“A&O”) advised the Co-Investors in connection with the sale by Banco de Bogotá’s of USD230 million worth of sustainable bonds in a private placement arranged by IDB Invest, the private sector affiliate of the Inter-American Development Bank (IDB).
The proceeds of the bonds will be used in accordance with the Issuer’s Sustainability Bond Framework and will finance a variety of initiatives including, for example, green projects, fund loans to micro, small and medium-sized enterprises (MSMEs) owned by women and cover mortgages for low-income households across Colombia. This sale marks the first sustainable issuance by Colombia's Banco de Bogota. In addition to IDB Invest, the other Co-Investors included IDB, the International Finance Corporation (IFC), the Canadian Development Institute (FinDev Canada) and funds managed by Finance in Motion (FiM).
This first-of-its-kind deal is a private placement on a Section 4(a)(2) basis that has been structured to facilitate broader secondary market access through clearing in the Depository Trust Company (DTC) and the planned listing on The International Stock Exchange (The Channel Islands). The issuance consisted of USD230 million in subordinated notes, which will be qualified as per Tier II Capital of the Issuer.
“We are proud to have advised on this landmark deal, which will serve as an example for alternative structuring in the development of the capital markets in Latin America and the Caribbean serving sustainable projects going forward,” said David Flechner, capital markets partner active in A&O’s Latin American practice. “This successful financing is a testament to A&O’s cross border expertise. We look forward to advising similar, groundbreaking deals that continue to further sustainability objectives on a global scale through the funding of social and green projects.”
The A&O team was led by New York and São Paulo-based partner David Flechner, supported by associates Cristina Palma and Daniel Mortati in New York.