Arab African International Bank has issued a USD 500 million sustainability bond, the first such instrument to be issued by a private bank in Egypt and the largest sustainability bond issued by a private bank anywhere on the African continent, the bank announced on 24 November 2024. The issuance was anchored by three development finance institutions: the International Finance Corporation committed USD 300 million, the European Bank for Reconstruction and Development contributed USD 100 million, and British International Investment provided the remaining USD 100 million, collectively accounting for the entirety of the bond's face value.
AAIB, established in 1964 as a joint venture between the Central Bank of Egypt and the Kuwait Investment Authority, said the proceeds would be deployed across both green and social categories in line with the bond's green and social eligibility categories.
GREEN AND SOCIAL ALLOCATION FRAMEWORK
Under the terms of the issuance, 75% of the bond's proceeds are allocated to green projects, encompassing three principal categories: industrial energy efficiency, small-scale renewable energy installations, and green buildings. The remaining 25% is directed towards social assets, with a focus on inclusive finance and support for micro, small and medium-sized enterprises across the Egyptian economy.