Citi Issuer Services Supports Inaugural Bond Issuance by The Climate Investment Funds (CIF) Capital Markets Mechanism (CCMM)

Rhea-AI Summary

Citi Issuer Services has completed the settlement of the Climate Investment Funds (CIF) Capital Market Mechanism (CCMM)'s first bond issuance. The 3-year bond raised US$500 million to support the Clean Technology Fund (CTF) in scaling up low-carbon technologies.

Citi acted as Note Trustee, Principal Paying Agent, and Calculation Agent for CCMM's borrowing program, which was listed in November 2024. CCMM, established in July 2024 and rated AA+ by Fitch and Aa1 by Moody's, raises private sector capital through bond issuances to support clean technologies in low- and middle-income countries, including renewable energy, energy efficiency, and clean transport.

Projects are financed through six implementing multilateral development banks, with the World Bank serving as CTF Trustee and Treasury Manager for CCMM.

Positive

• Secured role as Note Trustee, Principal Paying Agent, and Calculation Agent for CCMM's bond program
• Demonstrates Citi's capability in facilitating major international capital raising initiatives
• Strengthens position in sustainable finance and clean technology sectors

Negative

• None.

Insights

Financial Markets Expert

Citi's appointment as Note Trustee, Principal Paying Agent and Calculation Agent for CCMM's $500 million inaugural green bond issuance marks a strategic expansion of their sustainable finance capabilities. The deal's structure is particularly noteworthy for several reasons:

First, the high-grade ratings (AA+ from Fitch and Aa1 from Moody's) position this as a premium offering in the green bond market, likely generating stable fee income for Citi through trustee and agent services. While specific fee structures aren't disclosed, such arrangements typically provide recurring revenue streams through annual trustee fees and transaction-based compensation.

Second, Citi's role in this World Bank-affiliated initiative strengthens their competitive position in two important growth markets: 1) ESG-focused financial products, which have seen exponential growth in recent years and 2) emerging market development finance, where relationships with multilateral development banks can lead to future business opportunities.

The 3-year tenor suggests a conservative approach to market testing, potentially indicating plans for larger, longer-dated issuances in the future. For Citi shareholders, this represents a strategic positioning in the rapidly growing sustainable finance sector, with minimal credit risk exposure while maintaining fee-based income potential.

Additionally, the institutional framework involving six multilateral development banks reduces execution risk while providing multiple channels for future business expansion. This could serve as a template for similar arrangements, potentially establishing Citi as a preferred service provider in the sustainable finance ecosystem.

- Citi acted as Note Trustee, Principal Paying Agent, and Calculation Agent for CCMM’s first bond issuance

LONDON--(BUSINESS WIRE)-- Citi Issuer Services has completed the settlement of the Climate Investment Funds (CIF) Capital Market Mechanism (CCMM)’s first bond issuance today. The issuance is part of CCMM’s borrowing program which was listed in November 2024. Citi serves as Note Trustee, Principal Paying Agent, and Calculation Agent for the program.

The inaugural 3-year bond raised US$500 million with proceeds to be used for the Clean Technology Fund (CTF) to scale up low-carbon technologies.

Dirk Jones, Head of Issuer Services at Citi said, “By delivering Citi’s global network, we are enabling issuers to access capital around the world. Our role in this significant initiative and its inaugural issuance leverages Citi’s cross-border capabilities and technical expertise as we facilitate capital raising worldwide.”

Established in July 2024, CCMM raises private sector capital through bond issuances in international capital markets. Rated AA+ and Aa1 by Fitch and Moody’s respectively, CCMM channels funds to the CTF to support a wide array of clean technologies in low- and middle-income countries across different areas, including renewable energy, energy efficiency (of buildings, agriculture, and industry), and clean transport.

Projects are financed through six implementing multilateral development banks, including the World Bank, who is additionally the CTF Trustee and Treasury Manager for CCMM.

About Citi
Citi is a preeminent banking partner for institutions with cross-border needs, a global leader in wealth management and a valued personal bank in its home market of the United States. Citi does business in more than 180 countries and jurisdictions, providing corporations, governments, investors, institutions and individuals with a broad range of financial products and services.

Additional information may be found at www.citigroup.com | X: @Citi | LinkedIn: www.linkedin.com/company/citi | YouTube: www.youtube.com/citi | Facebook: www.facebook.com/citi

View source version on businesswire.com: https://www.businesswire.com/news/home/20250122529334/en/

Harsha Jethnani

+6593830872

harsha.jethnani@citi.com

Source: Citi

FAQ

What is the size and duration of CCMM's inaugural bond issuance supported by Citi?

CCMM's inaugural bond issuance is a 3-year bond that raised US$500 million.

What are Citi's roles in the CCMM bond program?

Citi serves as Note Trustee, Principal Paying Agent, and Calculation Agent for the CCMM bond program.

What credit ratings does CCMM have for its bond program?

CCMM is rated AA+ by Fitch and Aa1 by Moody's.

What is the purpose of CCMM's bond issuance supported by Citi?

The bond issuance proceeds will be used by the Clean Technology Fund (CTF) to scale up low-carbon technologies in low- and middle-income countries.

When was CCMM established and when was its borrowing program listed?

CCMM was established in July 2024, and its borrowing program was listed in November 2024.