ICO launches a new social bond issue amounting to 500 million euro

26 septiembre 2022

  • The issue has been very well received by international investors, who have acquired 84% of the bonds
  • With the funds raised, ICO will finance projects in public-private partnerships that promote social and territorial cohesion and generate a positive impact on employment.
  • ICO strengthens its role as a benchmark issuer in the sustainable bond market with thirteen transactions (9 social and 4 green) amounting to 6.55 billion euro
  • These operations have promoted more than 69,000 projects for the self-employed, SMEs and Spanish companies, which have contributed to maintaining more than 440,000 jobs, and prevented the emission of more than 692,000 tons of CO2 per year
  • With the issuance of social and green bonds, ICO is committed to promoting investments that generate a positive social and environmental impact, in line with the objectives established in the Recovery, Transformation and Resilience Plan

Instituto de Crédito Oficial (with rating A/Baa1/A-/A de S&P/Moody's/Fitch/DBRS) has launched a new social bonds issue amounting to 500 million euro, maturing on the 31st January 2028, which will be used to finance projects for the self-employed, SMEs and Spanish companies which generate a positive social impact and boost job creation.

With this new issue, ICO strengthens its commitment to the development of the sustainable bond market and consolidates its role as a benchmark issuer, with nine social bond issues and four green bond issues, with an issued amount of 6.55 billion euro.

The operation closed today has been well received by international investors, demonstrating the investor base’s confidence in the role of ICO. 84% of the operation has been placed between international accounts, highlighting the demand registered in Germany, Austria and France.

The issue has registered a demand of more than 1.1 billion euro. This oversubscription has allowed the operation to close with a spread of 14 basis points over the Treasury reference for the same maturity (5.4 years), narrowing the starting price that had been set at 16 basis points, with a return of 2.66%.

The quality of the order book in the distribution by investor type stands out. Fund managers have acquired 35% of the total volume of the issue, followed by banks with 31%, central banks and official institutions with 25% and insurance companies and pension funds with 9%.

The transaction, led by BNPP, Citi (B&D), HSBC and Santander Bank, is listed on BME's AIAF fixed income market. 

Issues with a positive social and environmental impact

With the issuance of social and green bonds, ICO commits to investors to promote projects that generate a positive social and environmental impact, in line with the objectives established in the Recovery, Transformation and Resilience Plan.

To do this, ICO channels the funds it raises with these operations towards the business fabric through its direct financing programs, ICO Mediation Lines, and funds managed by AXIS, its venture capital subsidiary.

With the social bonds, ICO has financed more than 69,000 projects for the self-employed, SMEs and companies, which have contributed to generating or maintaining more than 444,000 jobs. 

The issuance of green bonds has promoted 30 renewable energy and clean transport projects by Spanish companies, which have mobilised an investment of approximately 13 billion euro, preventing the emission of more than 692,000 tons of CO2 per year.