CaixaBank has become the first Spanish bank to issue a social bond to support the Sustainable Development Goals (SDGs) of the United Nations.
The Spanish lender has raised €1bn, maturing over five years, in non-preferred senior debt form, with the aim of facilitating the financing of activities that contribute towards economic and social development.
In particular with this initial issuance, loans are being funded to fight poverty, advocate dignified employment and create jobs in the most disadvantaged areas of Spain, in line with the SDGs of the United Nations, CaixaBank said in a note.
The Bond will include loans granted by MicroBank to individuals or families who live in Spain and whose total income is of €17,200 or below. The idea is to fund their daily needs including healthcare, education or household and vehicle repairs.
The current average amount of micro-loans granted by MicroBank to families is 4,100 euros. Since it was created 12 years ago, MicroBank has granted more than 930,000 micro-loans to families, entrepreneurs and small businesses.
The bond will also be used to fund loans granted to self-employed workers, micro businesses and small businesses operating across those Spanish regions with lower per capita GDP and/or a higher unemployment rate.
The bond's price has been set at 113 basis points over the mid-swap, and the coupon has been established at 0.625 per cent. The success of the issuance is reflected in its demand, which amounts to EUR2.25 billion, the bank said.
CaixaBank CEO, Gonzalo Gortázar, said: "This issuance strengthens our condition as pacesetters in socially responsible banking, directly contributing to the economic and social development of our customers, particularly those in a situation of vulnerability. CaixaBank's first Social Bond reaffirms our commitment to the major economic and social challenges of the United Nations' Sustainable Development Goals."