Green Bond Fact SheetBank Windhoek

Date: 17-Dec-2018

Issue date: 05-Dec-2018 Maturity date: N/A Tenor: N/AIssuer NameBank Windhoek

Amount Issued

NAD66.6m (USD4.8m)

Country of riskNamibia

CBI Database

Included

Issuer Type1

Financial corporate

Bond TypePrivate placement

Green Bond Framework

Link to Framework

Second party opinion

N/A

Certification Standard

Not certified

Assurance report

N/A

Certification Verifier

N/AGreen bond rating

N/A☒ Energy☒ Solar☒ Onshore wind
☐ Offshore wind
☒ Geothermal☒ Hydro☐ Tidal☒ Biofuels☒ Bioenergy☐ District heating☒ Electricity grid

☒ Energy storage☒ Energy performance☐ Infrastructure☒ Industry: components☐ Adaptation & resilience☒ Buildings☒ Certified Buildings☐ HVAC systems☒ Energyperformance☐ Water performance☒ Energy storage/meters☐ Other energy related☐ Industry: components☐ Adaptation & resilience☒ Transport☒ Electric vehicles☒ Low emission
vehicles☒ Bus rapid transit☐ Passenger trains☒ Urban rail

☐ Freight rolling stock☐ Coach / public bus☐ Bicycle infrastructure☐ Energy performance☐ Transport logistics☒ Infrastructure☐ Industry: components☐ Adaptation & resilience☒ Water & wastewater☒ Water distribution☒ Water treatment☐ Wastewatertreatment☒ Water storage☒ Storm water mgmt
☐ Desalinisation plants☐ Erosion control☐ Energy performance☒ Infrastructure☐ Industry: components☐ Adaptation & resilience☒ Waste management☒ Recycling☒ Waste prevention☒ Pollution control☐ Landfill, energy capture☐ Energy performance☒ Infrastructure☒ Waste to energy☐ Industry: components☐ Adaptation & resilience

Use of Proceeds☒ Land use & agriculture☒ Afforestation/parks☒ FSC/PEFC Forestry☐ FSC Cellulose &paper☐ Land remediation☐ Energy/water efficiency☒Drip irrigation☒ Sustainable agriculture☐ Adaptation & resilience☒ Other☒ Adaptation &resilience☐ ICT☒ Industry: process

Issue details
Reporting

The issuer will report annually on the allocated proceeds in the Investor Relations
section of its website. An impact report describing project location, amountfinanced, and impact indicators will also be published after having been reviewed by
an external reviewer/auditor.

Company information

Bank Windhoek is a commercial bank operating in the Namibian market under theumbrella of Capricorn Group.

Firsts, records andcertificationsFirst green bond from a Namibian issuer and second commercial bank to come tomarket in the South African region after Nedbank.

Proceeds description

According to the Green Bond Framework, proceeds can finance eligible projects
under a wide range of categories such as renewable energy, buildings, transport,water, waste, land use, adaptation, green trade and non-energy GHG emission
reductions. The criteria comply with the IFC Definitions and Metric for Climate
Related Activities.
Fossil fuel energy generation and coal mining are among the list of excludedproject types. However, projects leading to emissions reductions of fossil fuelrelated operations, such as gas flaring and fugitive methane emissions in existing
oil and gas industry installations, are allowed under the non-energy GHG emission
reductions category.

Climate Bonds view

There are multiple red flags that arise from the issuer’s eligibility categories. The
possibility of financing energy efficiency improvements and emission reductions tofossil fuel-based technologies is one of the areas of biggest concern. Furthermore,
the eligibility criteria for several categories are not stringent enough, such as for
the Buildings and Energy Efficiency which allow proceeds to be allocated tobuildings achieving any level of the listed green certifications and to energy
efficiency technologies achieving a minimum of 15% energy savings. Several areaslack clarity on eligibility requirements. For bioenergy and biomass projects, forinstance, there is no explicit requirement for sources to come from sustainable
feedstocks.
However, given the vast number of projects listed in the framework relative to thesmall size of the bond and the issuer’s commitment to reporting – publicly, on itswebsite – both proceed allocations and environmental impacts on a projectlevel(!), we are including the bond and will keep monitoring post-issuancedisclosure to gain more clarity on actual investment project allocations and theiralignment to the Climate Bonds Taxonomy.

Underwriters

Deal comments
Credit Rating
Pricing summary
Investors summary

1Issuer categories: ABS, development bank, financial corporate, government-backed entity, loan, local government, non-financial
corporate, sovereign