Social bond highlights commitment to sustainable economic and social development

Last year, AIB raised €1 billion in its first ever Irish social bond issuance. The funds were used to finance the healthcare, education, social and affordable housing sectors nationally and internationally, as well as to support SMEs located in socio-economically disadvantaged areas across Ireland.

Bond proceeds provided loans to health and residential care providers in Ireland as well as to Approved Housing Bodies (AHBs). The proceeds also contributed to the development of purpose-built student accommodation in Ireland and financed over 13,000 Irish SMEs.

Overall, €545 million was provided to support facilities in healthcare, a further €269 million went to social housing provision, and €154 million was provided for education services.

In January of this year, the bank raised a further €750 million in its second social bond issuance.

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“AIB’s social bond programmes emphasise the bank’s commitment to the creation and delivery of sustainable economic, social development in towns and communities across Ireland,” says AIB’s head of Treasury, Brendan Bane. “AIB’s social bond framework is aligned with the International Capital Markets Association’s (ICMA’s) principles governing the use of the bond proceeds and related transparency and reporting requirements.”

Our ambition is to contribute and advocate for a fairer society that is socially and economically inclusive by investing and raising awareness in access, education and innovation

—  Brendan Bane, AIB head of Treasury

In June, AIB was awarded Most Impressive Financial Institution ESG Bond Issuer at the GlobalCapital Bond Awards in recognition of its success in issuing both social and green bonds, he adds.

The social bond loan pool includes financing to the Circle Voluntary Housing Association (VHA). Established in 2003, Circle is a leading provider of social and affordable housing in Ireland. Circle’s vision is to make a real difference by delivering quality homes and innovative integrated housing solutions to individuals and families in Ireland. Circle works together with local authorities, State agencies, developers and funders to deliver new-build social and affordable housing solutions.

To date the organisation has delivered more than 2,500 homes, currently delivers services to over 5,000 people, and is helping to create thriving communities.

The organisation prides itself on ensuring tenants’ needs are at the heart of everything it does. Tenants are empowered to be involved in running their homes and communities, while also having a say in the shaping of the areas where they live.

Zita Zigmantaviciene, a tenant of Circle VHA, lives in Dunlavin, Co Wicklow with her husband. Speaking about her experience, Zigmantaviciene says: “We were renting and working for many years in Dunlavin, raising our two children. We felt very much part of the community, but had not found a permanent place to call home. When we were contacted by Circle, we were very happy to find our house, and we have settled in very well. There are many families here and it’s a close community. I love to garden, and we have made the most of our spot; I enjoy having coffee outside, looking out over the countryside. I am very happy here.”

The social bond supports key AIB objectives, according to Bane. “Our ambition is to contribute and advocate for a fairer society that is socially and economically inclusive by investing and raising awareness in access, education and innovation for our customers, our colleagues, and our communities,” he says.

“Our lending across healthcare, social housing and education via the proceeds from our social bonds is evidence of the progress being made in these areas, and we look forward to continuing to support customers on further projects,” Bane concludes. “As a bank at the very heart of the Irish economy, AIB’s role is to support our customers in the creation and delivery of sustainable economic, social and environmental development in towns and communities across the country.”