Rand Merchant Bank (RMB) was influential in several landmark 'impact' transactions in the awards eligibility period – and has ambitious plans to become a world leader in natural capital, carbon markets and blended finance.
RMB facilitated ZAR106 billion ($6 billion) of sustainable and transition finance – including 'impact' themed deals – in the awards eligibility period between April 2023 and September 2024, says Nigel Beck, head of sustainable finance and ESG at RMB.
This includes Lango’s inaugural $325 million sustainability-linked loan (SLL), one of Africa's largest SLLs in the real estate sector.
RMB also facilitated the first sustainability-linked bond (SLB) issuance in East Africa and the first SLB for a national development bank globally, for the Development Bank of Rwanda (BRD) – BRD's inaugural FRW30 billion ($24.8 million) SLB.
RMB was sustainability coordinator and arranger in South Africa's largest syndicated SLL for a food retailer, in Pick n Pay's inaugural ZAR4.5 billion syndicated SLL.
To steer its lending to be more positively impactful, RMB has also developed a framework that categorises lending exposures on its balance sheet, across 'green', 'olive', 'grey' and 'brown', according to the greenhouse gas emissions profile of its clients and transactions.
The strategy for RMB to accelerate transition lies in higher levels of new origination in the olive and green categories. RMB has introduced a minimum threshold of 80% renewable energy mix within the power generation portfolio by 2030.
As well as targeting positive climate impact, RMB aims to finance an increase in female representation at middle management at companies it lends to, provision of loans to women-led small- and medium-sized businesses and access to safe and fair social and labour conditions for value chain workers.
Beck says areas within impact finance with the most exciting potential for growth include voluntary carbon markets – particularly due to the operationalisation of Article 6 for carbon trading at COP29 this year – natural capital and blended finance.
RMB aims to grow its biodiversity bond programme to generate "up to" $150 million per year in funding for biodiversity and nature.
This includes bonds across species, landscapes, and water catchment areas, it said, adding that it wants to be the world's first commercial bank to arrange biodiversity bonds on a programmatic basis.
"RMB remains focused on partnering with clients across the jurisdictions where it operates, to understand their sustainability strategies and to link these strategies to their financing strategies in order to support them in their transition to a more climate-resilient, lower-carbon and socially inclusive economy," Beck says.
