Governments and companies worldwide are pledging to achieve net-zero emissions of greenhouse gases. To fulfil such a monumental ambition involves transitioning from fossil fuel-based systems to renewable and cleaner technologies.
Achieving net-zero emissions globally involves not just technological changes, but also enormous economic shifts at a scale unprecedented in history. The scale of investment required touches every sector of the economy and demands coordinated action between governments, private sectors, and civil society.
At Danske Bank, we recognise our critical role in mobilising the capital required to drive this transition and aspire to be the go-to bank on sustainable finance to our corporate and institutional clients.
Our dedicated teams in Corporate and Sustainability Advisory, along with Projects and Renewable Energy Finance, provide financial advisory and valuable insights from across the Nordic region to help companies access support mechanisms that can advance their sustainability objectives.
Material sustainability aspects are considered alongside financial factors in a holistic manner, drawing upon best practices and knowledge from across our teams. In this way, we wish to encourage the transition to a low-carbon economy through a full range of inhouse products and services, strategic positioning of business models and benchmarking, as well as helping to mobilise private and institutional capital towards mitigation of and adaptation to climate change.
We aim to meet our customers wherever they are in their transition journey.
Labelled Sustainable Products fall under two main categories
‘sustainability themed use-of-proceeds products such as green-, social-, sustainability- and transition products where the proceeds are restricted to finance a predefined type of investment or action
‘sustainability-linked products’ that link financing costs to sustainability performance through specific KPIs and performance targets but are un-restricted in the use-of-proceeds.
This simple categorisation helps you to understand the different types of products, irrespective of whether we are talking about bonds, loans, or guarantees.
“Use-of-proceeds” products are about providing transparency, and the determining aspect is what the money will be used for. This could be for environmentally beneficial activities; in which case the product would be called “green”. Or it could be for socially beneficial activities, in which case it would be called “social”.
Products funding a mixture of green and social activities come with a “sustainability” label. The label “transition” can be applied where the companies are bound to implement a credible science-based transition plan to reduce their footprint, and where the investment or activity financed isn’t yet green but actively helps the transition.
The simplest examples of a use-of-proceeds product are bonds or loans, where the borrower uses their funds for predefined green or social activities, which are assessed to have a positive impact.
The same logic applies to other products, like guarantees. For them to earn a green or social label, we need to understand the type of project or activity they are intended to be used for and assess whether those activities qualify.
Danske Bank has its own Green Finance Framework which sets out the criteria for what Danske Bank defines as ‘green’.
“Sustainability-linked” products are about incentivising and improving sustainability performance through linking the financing costs (e.g. the interest rate) to the client meeting ambitious sustainability performance targets. The most popular topics addressed include climate change, circularity, waste and material reduction, and gender diversity.
Financing the transition
Financing the climate transition is about supporting company-wide transition strategies rather than isolated activities. It is important for sectors where decarbonisation requires long-term, systemic change.
Danske Bank is proud to have supported European Energy with a GBP 58.1 million construction financing for the Indian Queens hybrid renewable energy project in Cornwall, United Kingdom.
@Loomis
Danske Bank acted as Joint Bookrunner for @Loomis Sustainability-Linked SEK 1bn 5-year senior unsecured bond issue.
Aalborg Portland
Danske Bank acted as the issuing bank on Aalborg Portland’s DKK 1.64bn guarantee.
Deutsche Pfandbriefbank AG
Danske Bank is proud to have acted as Joint Lead Manager on Deutsche Pfandbriefbank AG’s EUR 500m Green 3-year Senior Preferred benchmark.
NIB
Danske Bank is proud to have acted as Sole Lead Manager for Nordic Investment Bank (NIB) on its DKK 1 billion 9-year Environmental Bond transaction, marking NIB’s return to the Danish kroner market in green format.
BFCM
Danske Bank is proud to have supported Banque Fédérative du Crédit Mutuel Alliance Fédérale (BFCM) in its successful EUR 750m 7-year Green Senior Preferred benchmark issuance as Joint Lead Manager.
Ziklo
Danske Bank acted as Joint Lead Manager on Ziklo’s NOK 500 million & SEK 1 billion 5-year FRN & Green FRN EMTN Bond Issue.
Mirova
Danske Bank participated in project financing to support Mirova in the acquisition of an operational 88 MW portfolio of three onshore wind farms in Sweden.
Islandsbanki
Danske Bank is proud to have acted as Joint Lead Manager on Islandsbanki’s very successful dual-tranche 3-year Senior Preferred Green bond issuance in NOK and SEK.
Heimstaden Bostad
Danske Bank acted as Joint Lead Manager for Heimstaden Bostad SEK 650 million 3.5-year Senior Unsecured Green Bond issuance.
"Significant capital is needed for transitioning our economies to become more sustainable. We are committed to using the power of finance to support our clients in this transition", says Head of Sustainable Finance, Defence & Advisory, Samu Slotte.
Get in touch with experts advancing your transition
"Significant capital is needed for transitioning our economies to become more sustainable. We are committed to using the power of finance to support our clients in this transition".
Sara Åhlén Björk Nordic Head of Corporate & Sustainability Advisory, and
Acting Head of Corporate & Sustainability Advisory, Norway & Denmark
Mobile: +45 20742991
Email shln@danskebank.dk Follow Sara on LinkedIn
Peter Ax Head of Corporate & Sustainability Advisory, Sweden & Finland
Mobile: +46 (0)767-21 71 61
Email peter.ax@danskebank.se
Mogens Pedersen Head of Defence Centre of Excellence
Mobile: +45 2481 4304
Email mogp@danskebank.dk
"Financial instruments targeting sustainable purposes merge financial needs with sustainable development, whilst offering competitive terms. They can hence be a gateway to achieve both economic and sustainable progress at the same time."
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