First sustainability bond in Indonesia

Bank Rakyat Indonesia (“BRI”), the largest and oldest Indonesian bank issued earlier this year its first sustainability bond, a 5-year-maturity, to finance and/or refinance green and/or social bond projects in Indonesia. The USD 5OO million Sustainability Bond with a 3.95% coupon, was very successfully placed in the market with an oversubscription of 8.2 times.

Bank Rakyat Indonesia is a market leader in micro, small and medium enterprises banking. This bond was issued as part of the Bank’s inclusive and sustainable strategy. The BRI Sustainability Bond Framework is in line withthe Sustainability Bond Guidelines, the Social Bond Principles and the Green Bond Principles from ICMA as well as with the Association of Southeast Asian Nations (ASEAN) Sustainability Bond Standards Will open in a new tab . The transaction benefited from the second opinion of an independent third party, Sustainalytics. 

The proceeds of the sustainable bond will be allocated to:  

• Social projects: affordable basic infrastructure, access to essential services, affordable housing, employment generation, socioeconomic advancement and empowerment; 

• Environmental Projects: renewable energy, green buildings, pollution prevention and control, environmentally sustainable management of living natural resources and land use, clean transportation, sustainable water and wastewater management. 

Crédit Agricole CIB acted as Joint Lead Manager and Joint Sustainability Advisor. 

“This transaction is a testament to the strength, and global recognition of our Sustainable Banking expertise as BRI had wanted a market leader to structure its inaugural sustainability bond issuance. This key differentiator helped Crédit Agricole CIB to rise above the strong competition and become one of the only two banks mandated on this transaction.” 
Ravi Nichani, Debt Origination & Advisory 

“This transaction demonstrates Crédit Agricole CIB’s efforts and capabilities in supporting our clients all over the world in structuring and placing sustainable finance products with a strong local impact.”  
Dominique Duval, Head of Sustainable Banking for Asia-Pacific 

“Four words: proactivity, commitment, consistency and credibility. As a niche player in Indonesia, we made our difference by proactively proposing the idea of such a new format of issuance to BRI’s general management, considering their SME driven business model making them eligible for this thematic bond. Our commitment materialized with our consistent involvement and communication with BRI’s teams, helping them built their confidence level in applying and getting the Indonesian authorities’ prior approval for this first sustainable bond issuance (for a FI) in the country. Being one of the only two mandate banks is a strong proof of our credibility in the market, and our successful execution is a referent for Crédit Agricole CIB in Indonesia, especially towards the Indonesian authorities and their state-owned enterprises.” 
Franck Passillier, Chief Representative for Crédit Agricole CIB Indonesia