Commonwealth Bank and APM Human Services International have executed a social loan – a first for Australia’s sustainable finance market.
Social loans are a type of use-of-proceeds sustainable finance product used to support projects and activities that address a social issue or achieve positive social outcomes for certain populations, particularly underserved, marginalised, and vulnerable groups.
Aligned with the Asia Pacific Loan Market Association’s Social Loan Principles, the net proceeds of APM’s social loan will be used to finance or refinance funds related to delivering social services by APM to those with disabilities, the unemployed, and vulnerable groups.
APM established the first social-labelled corporate debt facility in Australia with CBA acting as sole social loan coordinator and key lender to the syndicated $840 million social loan facility. Skye Capital acted as debt advisor to the transaction while DNV provided a second party opinion.
“APM’s key business focus is to deliver social good, and we’re delighted to have worked with APM to develop an innovative sustainable finance solution to help recognise the important social contribution APM makes to communities in Australia and internationally,” said Michael Thorpe, managing director future cities and networks at CBA.
“Our sustainable finance capabilities help clients promote their ESG credentials to broader stakeholders and get recognition for the important social impact work they undertake,” said Charles Davis, managing director sustainable finance and ESG at CBA. “APM’s social loan marks a significant step in the development of Australia’s sustainable finance market, opening a new avenue for institutions to promote their social credentials. This is another example of how the sustainable finance market is becoming more holistic and expanding beyond the green and environmental focus to recognise social contributions by issuers.”
“We are proud to have the first social loan corporate facility in Australia,” said Steve Fewster, chief financial officer at APM. “The social loan demonstrates the social impact of the services APM provides to more than one million people every year and goes to our purpose of enabling better lives.”
