pipeline · Climate
NMB Bond I Project
Increased access to climate finance, including to MSMEs: While Nepals contribution to GHG emissions remains low, it is amongst the most vulnerable countries to climate change. Nepal ranks the 10th most affected country in the world according to the Climate Risk Index 2021. The country faces high risks of flooding and landslides, triggered by rapid snow and ice melt in the mountains as well as by torrential rainfall, especially during the monsoon season. The proposed investment will support NMB in continuing to increase financing for climate related projects including climate finance to SMEs, and broaden their scope of climate-related sectors. Competitiveness: IFC will promote greater competitiveness in the market for climate financing by supporting the issuance of a new instrument, green bonds, to raise financing for climate-linked projects. The market for climate financing remains dominated by government financing, and concessional loans and grants from multilateral agencies and bilateral donors, whereas financing from private sector remains very limited. In this context, IFC will support a systemically relevant financial institution in the country to issue the countrys first green bond. The bond will be issued in line with Green Bond Principles by International Capital Markets Association (ICMA) and international standards of green lending, thus reinforcing harmonized green practices in the market via demonstration and market enabling channels. IFCs investment in the first green bond will send a strong signal to the market, motivating other financial and non-financial institutions to also issue green bonds, and contribute to the development of the green finance market.
Overview
About this project
Increased access to climate finance, including to MSMEs: While Nepals contribution to GHG emissions remains low, it is amongst the most vulnerable countries to climate change. Nepal ranks the 10th most affected country in the world according to the Climate Risk Index 2021. The country faces high risks of flooding and landslides, triggered by rapid snow and ice melt in the mountains as well as by torrential rainfall, especially during the monsoon season. The proposed investment will support NMB in continuing to increase financing for climate related projects including climate finance to SMEs, and broaden their scope of climate-related sectors. Competitiveness: IFC will promote greater competitiveness in the market for climate financing by supporting the issuance of a new instrument, green bonds, to raise financing for climate-linked projects. The market for climate financing remains dominated by government financing, and concessional loans and grants from multilateral agencies and bilateral donors, whereas financing from private sector remains very limited. In this context, IFC will support a systemically relevant financial institution in the country to issue the countrys first green bond. The bond will be issued in line with Green Bond Principles by International Capital Markets Association (ICMA) and international standards of green lending, thus reinforcing harmonized green practices in the market via demonstration and market enabling channels. IFCs investment in the first green bond will send a strong signal to the market, motivating other financial and non-financial institutions to also issue green bonds, and contribute to the development of the green finance market.
Progress
0%- Plan
- Implementation
- Outcomes
Alignment