All Aboard Jernhusen’s Latest Green Bond

    Stockholm (NordSIP) – At the beginning of July, Jernhusen, the owner and operator of railway stations and other buildings attached to the railway network in Sweden, issued a three-year SEK300 million green bond. Among many other properties, the company owns Stockholm’s Central Station, Liljeholmen, and Solna Hagalunds Depå.

    “Jernhusen conducts active sustainability work to attract more people to travel collectively, which contributes to the climate change that is necessary in society. This also creates the conditions for green financing,” says Peter Anderson, CFO at Jernhusen.

    The green bond was issued at a premium corresponding to a floating interest rate 14 basis points over STIBOR.  On the occasion of this transaction, Jernhusen also repurchased the green bond maturing in October 2021.  The issue was made within the framework of Jernhusen’s Medium Term Note program (MTN program) and Jernhusen’s green framework.

    This was the 14th green bond issued by Jernhusen since 2018. Green bonds are issued under Jernhusen’s MTN program with the same conditions as other bonds, but with the addition that the issue proceeds for green bonds can only be allocated to projects and assets that are qualified according to Jernhusen’s green framework.

    In March of 2018, Jernhusen received a second-party opinion from Sustainalytics which considered that “the Jernhusen’s Green Bond Framework is credible and impactful and aligns with the four pillars of the Green Bond Principles 2017.”

    “The eligible use of proceeds categories (Green and Energy-Efficient Buildings; Energy Efficiency; Clean Transportation; Pollution Prevention and Control; and Renewable Energy) are recognized by the Green Bond Principles as project categories having positive environmental benefits and Sustainalytics views these project categories as having a positive impact,” Sustainalytics adds.

    “The selection of eligible projects and assets will be completed by the company’s business council, comprised of senior management, including C-level executives. Jernhusen’s internal process in evaluating and selecting projects is aligned with market best practice,” the second opinion argued.

    Regarding the use of proceeds, Sustainalytics also concluded that “Jernhusen has a dedicated Green Account to which proceeds from the green bond will be credited. This is in line with market best practice.”

    Photo from Wikimedia Commons

    Filipe Albuquerque
    Filipe is an economist with 8 years of experience in macroeconomic and financial analysis for the Economist Intelligence Unit, the UN World Institute for Development Economic Research, the Stockholm School of Economics and the School of Oriental and African Studies. Filipe holds a MSc in European Political Economy from the LSE and a MSc in Economics from the University of London, where he currently is a PhD candidate.

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