Ontario Teachers’ Pension Plan Launches Inaugural Green Bond

Posted on 11/20/2020

Ontario Teachers’ Finance Trust (OTFT) disclosed the issuance of a €750 million 10-year Green Bond. The issuance is fully, unconditionally and irrevocably guaranteed by Ontario Teachers’ Pension Plan Board (Ontario Teachers’). This marks OTFT’s inaugural green bond issued under the Ontario Teachers’ Green Bond Framework, which was prepared in accordance with the four core components of the International Capital Markets Association Green Bond Principles.

An amount equal to the net proceeds from this issuance will be allocated to assets that are environmentally and socially responsible and tackle critical issues like climate change. Eligible green assets satisfy one or more of the following:

Replace direct fossil-fuel use;
Facilitate low-carbon solutions;
Significantly reduce emissions;
Remove/store carbon;
Help adapt to climate change impacts; or
Help preserve or conserve scarce natural resources

The Ontario Teachers’ Green Bond Framework was reviewed by CICERO Shades of Green, a provider of Second Opinions on green bond frameworks.

Shearman & Sterling advised BNP Paribas, Citigroup Global Markets Limited, Crédit Agricole Corporate and Investment Bank and HSBC France, as joint book-running managers, and Barclays Bank PLC, Goldman Sachs International and J.P. Morgan Securities plc, as co-managers, in connection with Ontario Teachers’ Finance Trust’s (OTFT) Regulation S private placement of €750 million aggregate principal amount of 0.050 percent senior notes due 2030.

Ontario Teachers’ Finance Trust issues commercial paper and term-debt that is fully, unconditionally and irrevocably guaranteed by Ontario Teachers’. OTFT primarily generates funding through fixed income products in international markets. Since its inception in 2015, OTFT has issued U.S. and Canadian dollar-denominated commercial paper in addition to U.S. dollar, Canadian dollar and EUR benchmark-sized term debt targeting international institutional investors. The coupon and principal paid to investors are senior to pension liabilities.

Keywords: Ontario Teachers Pension Plan.

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