BMO proud to support first Government of Canada Green Bond transaction as joint-lead manager

Rhea-AI Summary

BMO Financial Group acted as a joint-lead manager for Canada’s inaugural Green Bond, raising C$5 billion—the largest Green Bond in the Canadian market. Proceeds will fund initiatives aimed at reducing greenhouse gas emissions, enhancing climate resilience, and conserving nature. The transaction garnered C$11 billion in demand from nearly 100 investors, with 45% of the bonds distributed internationally. This initiative aligns with Canada’s goal of achieving net-zero emissions by 2050 and further develops sustainable finance in Canada.

Positive

• BMO facilitated a record-setting C$5 billion Green Bond transaction, enhancing its reputation in sustainable finance.
• Significant investor demand of C$11 billion, indicating strong market interest.
• BMO is positioned as a leader in sustainability, reinforcing its commitment to ESG principles.

Negative

• None.

• C$5-billion transaction marks the largest ever Green Bond in the Canadian dollar market and a paramount development in Canada's sustainable finance market.
  
• Proceeds will support green investments, including reducing greenhouse gas emissions, enhancing climate resilience, conserving nature and protecting the environment

TORONTO, March 23, 2022 /PRNewswire/ - BMO Financial Group (TSX: BMO) (NYSE: BMO) today congratulated the Government of Canada on the successful completion of its inaugural Green Bond transaction and is proud to have acted as a joint-lead manager on this landmark achievement. 

The C$5-billion transaction demonstrates Canada's environmental leadership, ensures government expenditures align with Canada's ESG goals and principles, and acts as a catalyst towards the continued development of the sustainable finance market in Canada. The Government of Canada recognizes that sustainable finance plays a key role in accelerating the transition to a cleaner economy, and that mobilizing capital is a critical part of Canada's work to meet its 2030 emissions reduction target and achieve net-zero emissions by 2050.

Nearly 100 investors participated in Canada's debut transaction, with final demand of over C$11 billion. 45 per cent of the transaction was distributed internationally, illustrating the strong appetite for CAD green bonds globally and a true testament to investors' interest for Canada's AAA credit rating.

The Government of Canada Green Bond Framework, developed in accordance with the International Capital Market Association's (ICMA) Green Bond Principles (2021), defines the criteria for the use of proceeds from green bonds as those projects that will facilitate the transition to a low-carbon economy and contribute to the climate goals set out by the government.

"We're proud to be a joint lead-manager on the issuance of the first Government of Canada Green Bond," said Jonathan Hackett, Head, Sustainable Finance and Co-Head, Energy Transition Group, BMO Financial Group. "The establishing of a green financing program by the Government will help to accelerate sustainable finance adoption in Canada and is strongly aligned with BMO's Climate Ambition and our Purpose to Boldly Grow the Good in business and life."

BMO is a recognized sustainability leader

Carbon neutral in its own operations since 2010, BMO announced its Climate Ambition in March 2021 with a commitment to deploy $300 billion in sustainable lending and underwriting to companies pursuing sustainable outcomes by 2025.  BMO is focused on being its clients' lead partner in their transition to a net zero world and, since December 2019, has completed green and sustainability-linked loans for companies in a range of sectors, with targets including decarbonization, diversity & inclusion, and health and safety. To support clients' pursuit of opportunities driven by the increasing momentum of the global economy's shift in production and consumption of energy, in 2021 BMO established a dedicated Energy Transition Group and the BMO Climate Institute.

BMO's leadership on sustainability has been recognized on a number of rankings, including the Wall Street Journal's 100 Most Sustainably Managed Companies in the World, Corporate Knights' Global 100 Most Sustainable Corporations, Dow Jones Sustainability Indices World Index, and Ethisphere Institute's list of the World's Most Ethical Companies.

For more information on BMO's commitment to a sustainable future, please visit the bank's latest Sustainability Report. To learn more about sustainable finance at BMO click here. For BMO's climate ambition, visit its Climate page.

About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $1.02 trillion as of January 31, 2022, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.

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SOURCE BMO Financial Group

FAQ

What is the significance of BMO's involvement in Canada's Green Bond?

BMO acted as a joint-lead manager for Canada's first Green Bond, raising C$5 billion to support sustainable investments.

How much demand was there for Canada’s inaugural Green Bond?

The Green Bond transaction attracted C$11 billion in demand from nearly 100 investors.

What are the goals of the Green Bond proceeds?

The proceeds will fund projects aimed at reducing greenhouse gas emissions and enhancing climate resilience.

What percentage of the Green Bond was distributed internationally?

45% of the Green Bond was distributed internationally, showcasing strong global interest.

What is BMO's commitment to sustainable finance?

BMO has a Climate Ambition to deploy $300 billion in sustainable lending and underwriting by 2025.