Bank Windhoek supports national development with first Sustainability-Linked Bond

STAFF WRITER 

Bank Windhoek’s Chief Treasurer, Claire Hobbs says a Sustainability-Linked Bond (SLB) launched by the bank on Wednesday shows their commitment to supporting sustainable development and economic growth in Namibia.

An SLB is a fixed-income instrument (Bond) whose financial and structural characteristics are tied to predefined sustainability objectives, differentiating it from the typical use of proceeds- type instruments.

“As a truly Namibian bank, we recognise the importance of financing traditional growth sectors and prioritising emerging, high-impact niches within the economy. One such area is Sustainable Finance, which is not only about risk and return but also prioritises specific impact areas linked

to national development goals and sustainability objectives,” said Hobbs.

She added that, “Building on its experience as the first Namibian issuer of Green and Sustainability Bonds, the Bank has used the lessons and momentum gained from these instruments to explore new models that further drive sustainability integration into its operations. “The Sustainability- Linked Bond is a significant evolution in our approach: unlike use-of-proceeds bonds, this instrument directly commits the Bank to achieving defined sustainability performance targets.”

Hobbs also shared that the auction on 19 August for the three-year Sustainability Linked Bond attracted bids of NAD525.5million, of which NAD 250.5million was allocated at a rate of 3- month JIBAR + 80 bps. “The auction was 1.75 times oversubscribed speaking to investor interest for this type of thematic issuance, that is a first of its kind for the Namibian market

Bank Windhoek committed to deploying N$ 300 million in sustainable finance over the next two years. 

Hobbs emphasised that this target is grounded in the work the bank has already undertaken through its Sustainability Loan offering.

“In designing this instrument, being a relationship bank, we engaged with various stakeholders, drawing from their insights and global best practices we could learn from. The resulting bond structure reflects our first attempt at this type of instrument, the unique market contexts and

institutional capacity, while also challenging us to raise the bar in sustainable finance,” said Hobbs.

She said Bank Windhoek aims to create meaningful impact, enable greater client participation in sustainability efforts as it works to achieve its commitment, and continue to play a catalytic role within the Namibian economy.