Egypt’s Commercial International Bank (CIB) has become the first private sector-led green bond issuer in the local market, after officially receiving initial approval from the Financial Regulatory Authority (FRA) on 21st of June.

CIB will be able to issue $100 million first green bonds in the MENA region to finance the private sector, with Minister of International Cooperation Dr. Rania Al Mashat highlighting the importance of the announcement.

The International Finance Corporation (IFC), a member of the World Bank Group, will subscribe to the full value of the issue.

 “The CIB’s green bonds issuance today, which is financed by the IFC, is a model of the private sector engagement in the recovery process in Egypt and the role it can play in this process," said Al-Mashat.

Marking the news, CIB also announced it is set to publish its Green Bond Framework this week.

The framework will establish the parameters for the use of proceeds, eligibility, selection criteria for the projects funded by loans extended to clients, the management of proceeds, as well as reporting and impact evaluation.

The milestone will contribute to the efforts made to support the transformation of the Egyptian economy into a green economy and to play a vital and influential role in achieving Egypt’s 2030 Agenda and its sustainable development goals, in addition to being the first of its kind in Egypt.

CIB will be able to use proceeds to fund a portfolio of green loans to both its corporate and small and medium-enterprise (SME) clients, with the tenor of the issue as five years, and also help fund the CIB's green building capital expenditure, using up to 20 percent of the proceeds.

The proceeds from the bonds are expected to be spread out to various climate-supporting initiatives, including green buildings, energy efficiency, renewable energy, water and wastewater management, and clean transportation, said the CIB.

According to the latest data, sustainable bonds which include social and green bonds, have increased by more than 80% compared to 2019. 

El-Mashat stated that signing the green bonds by the Commercial International Bank-Egypt (CIB) and the IFC, emphasises the importance of the private sector’s role in pushing towards the green recovery, building on the Egyptian government's progress in drawing global investors’ attention to the local market, supporting the transition towards a greener economy.

Egypt issued its green bonds, the first of their kind in the MENA region, in September and offers them on the London stock exchange with a total worth of $750 million.