The European Bank for Reconstruction and Development has invested €72.5 million in a €305 million issuance of sustainability-linked bonds (‘SLB’) Zagrebački holding, marking the first SLB issuance by the public sector in Croatia. Zagrebački holding is the largest utility company in Croatia, responsible for water supply and drainage services, waste management, maintenance of roads, public areas, and parking, gas distribution, and other utility services for the residents of the City of Zagreb, provided through its network of branches and subsidiaries.
Issuers of sustainability-linked bonds commit to achieving specific sustainability targets, and if these are not met, they agree to pay an additional fee to investors. Zagrebački holding will work on improving existing waste management practices and increasing the share of electricity generated from renewable sources in total electricity consumption as part of this issuance.
The bonds were issued on July 11, with a single maturity after five years. The bond was issued with a yield of 4.94 percent and a fixed coupon interest rate of 4.9 percent, with semi-annual payments.
– We are proud to have supported Zagrebački holding in the issuance of sustainability-linked bonds, which are the first instrument of this kind issued by the public sector in Croatia. EBRD is ready to continue supporting Zagrebački holding and the City of Zagreb on their path to sustainability – stated Victoria Zinchuk, EBRD’s regional director for Central Europe.
