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Bank of America Officially Announces Third Equality Progress Sustainability Bond for $2 Billion

Bank of America Officially Announces Third Equality Progress Sustainability Bond for $2 Billion

  • Use of Proceeds Designed to Advance Racial and Gender Equality, Economic Opportunity and Environmental Sustainability
  • This is Bank of America’s Tenth ESG-themed Bond, Raising Nearly $14 Billion in Aggregate, Demonstrating Continued Commitment to Advancing the United Nations Sustainable Development Goals (UN SDGs)

Bank of America announced the issuance of its third Equality Progress Sustainability Bond (EPSB) for $2 billion. The use of proceeds from the bond offering is designed to advance racial and gender equality, economic opportunity and environmental sustainability.

This transaction marks the second offering following the publication of Bank of America’s ESG-themed Issuance Framework last year, aligning to company’s leadership in sustainable finance and goal of mobilizing and scaling capital deployment to help advance the UN SDGs.

The “Equality Progress” label is outlined in the Framework and is designed to advance equality and economic opportunity for historically marginalized populations by focusing on financing and investments that provide people of color or women with expanded access to essential services, such as affordable housing, and business capital.

Bank of America will allocate at least 50% of an amount equal to the net proceeds from the sale of the bond to one or more eligible Equality Progress Social Assets, with the remainder allocated to eligible Green Assets (together “Eligible Assets”).

“Fueled by the success of the first and second Equality Progress Sustainability Bonds, this bond demonstrates how the financial community can find ways to create meaningful impact in the lives of individuals and further socioeconomic empowerment for underserved populations,” said Paul Donofrio, Vice Chair at Bank of America.

This issuance expands upon Bank of America’s first Equality Progress Sustainability Bond, which was issued in 2020 and the first sustainability bond issued by a U.S. bank holding company where the social portion of the use of proceeds was dedicated to the financial empowerment of Black and Hispanic-Latino communities. The second Equality Progress Sustainability Bond was issued in 2021, which broadened the scope of the target populations for eligible Equality Progress Social Assets to include women and Asian American, Pacific Islander and Indigenous people, along with Black and Hispanic-Latino populations.

See related article: Bank of America Issues $2 Billion ESG Bonds

“The issuance of our third Equality Progress Sustainability Bond demonstrates our commitment and consistent approach to financing and investing for environmental and social sustainability. We are very encouraged by the enthusiastic response from the global investor community toward our issuance framework and anticipate this will pave the way for sustainability investments that help advance racial and gender equity and the environmental transition to become more mainstream,” said Karen Fang, Global Head of Sustainable Finance at Bank of America.

The six-year bond, which is callable in five years, will pay interest semi-annually at a fixed rate of 6.204% for the first five years, and quarterly at a floating rate thereafter. BofA Securities was the sole bookrunner on the deal and six minority- or women-owned broker dealers served as joint-lead managers – Academy Securities, Blaylock Van, Loop Capital, R. Seelaus & Co, Ramirez & Co and Siebert Williams Shank.

Within one year of the issuance of this Equality Progress Sustainability Bond, Bank of America will publish a report related to the use of proceeds of the bond on the company’s ESG-Themed Issuance webpage, located on the Bank of America Investor Relations website. The information in the report regarding allocation to Eligible Assets will be updated at least annually as long as the bond remains outstanding.

Bank of America is the #1 US corporate issuer of ESG bonds having issued $13.85 billion across five green, two social and three sustainability bond issuances, which focused on areas such as clean energy, energy efficiency, affordable housing and community development, and addressing the global coronavirus pandemic. More than a decade ago, Bank of America co-authored the original Green Bond Principles, a voluntary set of guidelines and standards meant to bring integrity to this market where proceeds help to directly finance environmental projects. Bank of America has also been a member of the executive committee of the industry group that provides guidance on ESG-themed bond issuances since its inception.

Bank of America has set tangible sustainable finance goals and made measurable progress in mobilizing and scaling capital deployment to help drive social and environmental change aligned with the UN SDGs. As part of the company’s commitment to mobilize and deploy $1.5 trillion in sustainable finance by 2030, approximately $250 billion of capital was mobilized and deployed in 2021.

In addition, BofA Securities has helped clients across all sectors support their sustainable business needs by raising in excess of $500 billion in principal amount through more than 700 ESG-themed bond offerings.

Source: Bank of America


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