"The transaction attracted a great deal of interest from investors in Latvia, Lithuania and Estonia, and was 6.5 times oversubscribed,'' Altum said in a press release.
Altum issued its first green bond October 10, with a total value of 20 million euros and a maturity date of 17 October 2024, a fixed annual interest rate (coupon) of 1.3%, and a yield of 1.367%.
The bonds were allocated to 24 investors from: Latvia (43.5%), Lithuania (31%), Estonia (19%), Sweden and Germany (6.5%) and will be listed on Nasdaq Riga.
Proceeds from the bonds will be used to finance viable business projects supporting energy efficiency and use of renewable energy.
"This will significantly widen the scope of financial support in Latvia for green minded projects and environmental sustainability. Eligible project categories will cover energy efficiency as district heating, energy recovery, energy consumption reduction projects, energy efficient buildings, use of renewable energy as wind, solar and bio energy, green buildings and sustainable transportation, including ESCO corporates operating in those segments," Altum said.
Reinis Berzins, Altum CEO said Latvia has "huge potential for implementation of sustainable green-minded projects," and that the bond would also ''diversify Altum's funding base and encourage Baltic debt capital market development."
The Green bond is a climate-related fixed income instrument allowing investors to participate in climate financing, and to raise awareness on climate related risks in addition to making a sound investment. The Green bond market has grown rapidly over the last decade with total, cumulative issuance exceeding USD 300 bn and the total number of individual Green bond issuers approaching 500. Altum is the fourth issuer domiciled in the Baltic States but the first national development institution in Central Eastern Europe to provide investors with such an investment opportunity.
SEB acted as the arranging bank for the Green bond transaction.
Altum’s green bond investments have been assessed and approved by the Center for International Climate and Environmental Research - Oslo (CICERO), a Norwegian independent institute for interdisciplinary climate research. You can read more about the green bonds HERE.
Altum is rated Baa1 by Moody’s Investors Service.