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APICORP’s Debut Green Bonds Raise $750m

The APICORP logo
The APICORP logo
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APICORP’s Debut Green Bonds Raise $750m

The APICORP logo
The APICORP logo

The Arab Petroleum Investments Corporation (APICORP), a multilateral development financial institution focused on the energy sector, announced that it has successfully raised $750 million from its debut green bonds.

The US-denominated five-year benchmark issuance, the first green bond in the MENA region issued by an energy-focused investment institution, was nearly three times oversubscribed, garnering $2.2 billion in orders from more than 80 institutional and sovereign investors.

All projects funded by APICORP using these green bonds will be aligned with the United Nations Sustainable Development Goals (SDGs), with a focus on renewable energy, green buildings, pollution prevention and control, and low-carbon technologies and solutions.

A designated Green Bond Committee (GBC) will oversee the evaluation process of the projects to ensure their compliance with APICORP’s recently launched ESG and Green Bond Frameworks, alignment to best practices, and that they support local and national energy sustainability strategies.

In addition, APICORP plans to issue an Annual Green Bond Report on the environmental impact of the bonds to ensure stakeholder visibility.

CEO of APICORP Dr. Ahmed Ali Attiga said, “The shift to more sustainable energy solutions is no longer an option, it is a must, and we at APOCORP are here to accelerate this shift within the region.

“Through our debut green bonds, APICORP opens new investment avenues to build a more sustainable future for the Arab world and give millions of people access to safer, cleaner, and more affordable energy sources.”

In terms of geographic distribution, investors from outside the Arab region accounted for 93 percent of the total subscribers of the issuance, with 45 percent based in the UK and Europe. Notably, 63 percent of the subscribers are strictly ESG-focused investors.

For his part, Chief Financial Officer of APICORP Dr. Sherif El Sayed Ayoub said, “The success of our green bonds reflects the strong demand in sustainable investments.

The interest from leading global institutional and sovereign investors in this issuance, particularly those focused on sustainable and responsible investing, also underscores the strong reputation APICORP has built and their trust in our ability to promoting the ESG agenda in the MENA region.”

APICORP recently announced that it will allocate almost $1 billion to green energy projects over the next two years.

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Lagarde: ECB's October Decision Will Reflect Greater Confidence on Inflation

ECB President Christine Lagarde. (EPA)
ECB President Christine Lagarde. (EPA)
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Lagarde: ECB's October Decision Will Reflect Greater Confidence on Inflation

ECB President Christine Lagarde. (EPA)
ECB President Christine Lagarde. (EPA)

The European Central Bank (ECB) is increasingly confident that inflation will fall back to its 2% target and this should be reflected in its October policy decision, ECB President Christine Lagarde said on Monday.

She said cross-border banking mergers in Europe were "desirable" to boost their competitiveness, just as Italy's UniCredit was looking to increase its stake and possibly take over Germany's Commerzbank.

The ECB cut interest rates from record highs in June, and cut again earlier this month, but Lagarde gave few hints at the time about the bank's next move, leaving markets guessing.

Lagarde's comments on Monday will bolster already abundant bets on a further cut in October given a rapid deterioration of the growth outlook and falling energy costs.

Inflation in the 20-nation currency bloc likely fell below the ECB's 2% target for the first time since mid-2021 this month, a raft of national data suggests.

This, along with poor growth indicators, has raised bets on a 25 basis point rate cut in October and markets now see a 75% chance of a move, up from 25% seen early last week.

Lagarde also acknowledged the recent run of poor growth readings.

“Looking ahead, the suppressed level of some survey indicators suggests that the recovery is facing headwinds,” she told a regular hearing of the Committee on Economic and Monetary Affairs.

Still, she repeated the bank's usual line that the recovery is expected to strengthen and rising real incomes should allow households to consume more.

She added that the labor market, the source of some price pressures via rapid wage growth, remains resilient, even if wage growth is moderating and corporate profits are absorbing some pay increases.

Meanwhile, Lagarde said cross border mergers among Europe's biggest banks are needed, just as Italy's UniCredit was looking to increase its stake and possibly take over Germany's Commerzbank.

“Cross borders mergers -- banks that can actually compete at a scale, at a depth and at range with other institutions around the world, including the American banks and the Chinese banks -- are in my opinion desirable,” she told a parliamentary hearing.

She added that her comments should not be taken as a direct intervention in any particular deal.