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Teachers Mutual Bank Ltd (TMBL) issued A$100 million of three-year notes, the first ethical bond from a mutual bank in Australia.
TMBL became the first Australian financial institution to have its entire wholesale debt issuance programme ethically certified by the Responsible Investment Association of Australia (RIAA) in August 2015.
The issuance of A$100m three-year notes was at 140 basis points over the three-month bank bill swap rate (BBSW), at the tight end of 140-145 basis points over BBSW price guidance.
The bonds were placed domestically to 39 accounts. Fund managers made up 41 per cent, authorised deposit-taking institutions (ADIs) at 38 per cent and middle-market accounts at 21 per cent.
"This is the first certified ethical investment wholesale cash product in Australia, and the certification attracted wider investor interest in the bank than we have seen before. A number of ethical themed funds participated for the first time, although their contribution was not a major proportion of the book. There was no price premium for the ethical aspect of the debt” said Glenn Sargeant, CFO at Teachers Mutual Bank.
"The whole premise of our business is to act responsibly and ethically within our mandates. In the end, all of our funding activities should be ethical anyway. It's not just about how we complete our funding objectives but also how we conduct our business."
"As a member-owned bank, Teachers Mutual Bank has always had a strong ethical banking and sustainability record. We understand the long-term impact our business has on the economy and communities in which we operate, and recognise we have an obligation to be responsible in the way we lend and invest”.
"RIAA is pleased to support this landmark issuance in the Australian market by Teachers Mutual Bank, at a time of increasing movement of capital towards responsible and ethical investments. Having been Certified by RIAA, investors can be sure that the bond is true to label, delivering on its commitments, after having completed a rigorous assessment and verification process. It's pleasing to see again that an ethical approach to responsible finance can deliver a win-win for investors and the environment.” said Simon O’Connor CEO of RIAA.
TMBL is the first bank in Australia to have a Certified Ethical Investment wholesale cash product
TMBL's $500m Issuance Programme (DIP) for wholesale investors has been certified by the RIAA on the basis that the Bank’ Policy is ‘the exclusion of lending to, or investing in, large scale greenhouse gas pollution from fossil fuel exploration, extraction, production and use.’
The RIAA certification is of TMBLs’ $500m Debt Issuance Programme (DIP) for wholesale investors. The cash proceeds raised are used to fund TMBL’s balance sheet. Under the $500m Debt Issuance Programme,
It is the first certified ethical investment wholesale cash product in Australia.
It is the first certified ethical investment wholesale cash product that is based on fossil fuel lending and investing exclusion.
TMBL’s $500m Debt Issuance Programme has been certified by RIAA according to the strict operational and disclosure practices required under the Responsible Investment Certification Program. See www.responsibleinvestment.org for details