The issuers of these instruments they explicitly commit to future improvements in their sustainability performance within a previously defined period.
This is an unprecedented development in the country, carried out between BYMA and the Buenos Aires Stock Exchange, with which a new form of financing is proposed that promotes sustainable finance at the local level. In this regard, the President of BYMA, Ernesto Allaria, explained: “Through this initiative, we seek to bring new financing alternatives to the market in line with international standards that allow issuers and investors to be part of the Kyoto Protocol, the Paris Agreement and contribute to the Sustainable Development Goals.”
Features of the new VS Bonus Panel
The VS Bonds created by the International Capital Markets Association (ICMA) can be any type of security whose financial and/or structural characteristics may vary depending on the achievement or not of certain sustainability objectives by the issuer within a predefined period.
For the issuance of the bonus, the performance objectives will be defined in (SPTs), the key performance indicators (KPIs) with which they will be evaluated, the potential changes in the financial and/or structural characteristics of the VS Bond and the triggering events that lead to them.
Unlike Green, Social or Sustainable Bonds, the benefits of the issue are not linked to eligible social and/or green projects, but to general purposes of the issuer, so the specific use of the funds is not decisive for their categorization.
The issuers of this type of bonds must comply with the requirements established in the Listing Regulations and, additionally, with those required in the Sustainability-Linked Bonds Regulations. There must be an External Review that confirms the alignment of the Bond with the ICMA Sustainability-Linked Bond Principles.
During the life of the bond, the issuer must submit to BYMA for dissemination a report on the results of the key performance indicators (KPIs), with respect to each sustainability performance objective (SPTs). Said information must have independent external verification.
BYMA will give visibility to the VS Bonds in a specific Panel and, later, they can be traded in the same systems that the Market provides for the negotiation of the different negotiable securities.
This initiative is in line with BYMA’s sustainable development strategy which, as a member of the Sustainable Stock Exchanges Initiative, has already tackled different projects in recent times, such as the creation of the Corporate Governance Panel, the launch of the Index BYMA Sustainability Committee and the Panel on Social, Green and Sustainable Bonds.
Operating Flow
PANEL WEBSITE: https://www.byma.com.ar/bonos-vinculados-sostenibilidad/
Source: Ambito
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
