Real estate firm’s first-ever green bond listed on local bourse

Bunthoeun 20/January/2023 09:30
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Key Takeaway:  

  • Golden Tree successfully raised about $ 1.5 million through the green bond issuance 
  • The company’s green bond issuance has received technical support from Asian Development Bank
  • The green bond is part of sustainable financial instrument 
  • The green bond remained the most popular in 2021, with cumulative green volumes in ASEAN-6 countries stood at $39.4 billion. 

“The green bond listed today reflects the securities sector’s contribution to the positive environment and climate change” 

Golden Tree – one of the leading real estate companies in Cambodia providing services in commercial office lease, property management, and real estate consultation – announced Thursday 19 January on its official maiden green bond listing ceremony on the Cambodia securities and exchange (CSX).

The company successfully raised about $ 1.5 million through green bond issuance. The move plays a crucial role in contributing to the Cambodian government’s mission to a more environmentally friendly while promoting sustainable economic growth.

Mr. Oum David, Executive Vice President and Chief Financial Officer of Golden Tree, stated that introducing a green bond to Cambodia will boost the company’s reputation and attract more local and international investors. It is an opportunity for Golden Tree to expand its business while enhancing the growth of the sustainable finance sector in the kingdom.

“We believe that both the public and private sectors should get involved in environmental protection. The green bond listing will enable our investors to gain a thorough understanding of sustainability securities investments and to benefit while preserving the environment,” he said.

Mr. Oum David, Executive Vice President and Chief Financial Officer of Golden Tree

The company successfully mobilized around $1.5 million from the issuance of its circa 60 000 green bonds at a par value of $25, with a coupon rate of 7 percent per annum and 5 years maturity date. The bond was underwritten by SBI Royal Securities Plc, with Cambodia Securities Plc as co-underwriter.

H.E Hong Sok Hour, CEO of CSX, said the listing of the green bond is comparable to other bond listings. However, green bond issuance is required to adhere to investment guidelines that leave no harm to the environment.

“The green bond listed today reflects the securities sector’s contribution to the positive environment and climate change,” he said.

The local bourse is currently, according to H.E Sok Hour, featuring 18 firms – nine of which are listed on the main and growth board, and the rest issued bonds. These companies raised a whopping $317 million through their offerings.

H.E Hong Sok Hour, CEO of CSX delivers his speech at the listing ceremony

Golden Tree’s green bond issuance has received technical support from Asian Development Bank (ADB) to issue and comply with the standard of the ASEAN Green Bond. Golden Tree’s CFO Mr. David has highlighted that the bond issuance is in line with the company’s perspective and far-sighted vision to become one of the leading real estate companies in the country.  Achieving this, in which he said, by strengthening corporate governance, transparency in the financial system, and commitment to the standard of environmental, social, and good governance.

“We would like to design and implement long-term, sustainable policies that support Golden Tree’s growth and address the environmental and social impacts at the same time,” David said.

The International Finance Corporation (IFC), a member of the World Bank Group, last year October awarded Cambodia’s first EDGE (Excellence in Design for Greater Efficiencies) green-building certification for commercial office projects to VTrust Tower, owned by Golden Tree. The recognition is given to VTrust Tower because the building succeeded in attaining its requirement by achieving 24% savings in energy consumption, 52% saving in water consumption, 84% less embodied energy in the material, and CO2 emission reduction by 232 tons annually.

Sustainable financial instruments are gaining momentum in ASEAN

Sustainable finance is defined as the process of taking environmental, social, and governance (ESG) factors into account when making financial investment decisions, resulting in longer-term investments in sustainable economic activities and projects. Sustainable financial covers green, social, and sustainability – GSS.

The green theme remained the most popular in 2021, wrote a report by Climate Bond Initiative, which noted that cumulative green volumes in ASEAN-6 countries stood at $39.4billion at the end of 2021, or roughly 72% of the region’s GSS market, followed by sustainability debt at $14.4billion, which accounted for the other 27%. The social theme was negligible, with a cumulative volume of $ 0.6 billion making up 1% of the market. The ASEAN-6 countries in this report featuring Singapore, Vietnam, Thailand, Indonesia, Malaysia, and the Philippines.

According to the report, Singapore maintained its position as a regional leader, with a total GSS volume of $13.6 billion in 2021, more than double the 2020 figure of $4.9bn, with the growth driven by the green theme.

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