The green journey
We all want to help make a better future and every little bit makes a difference. Man-made climate change is one of the greatest challenges we are facing and how we manage capital could have a decisive impact on the future.
At Arion Bank we strive for continuous improvement and we want the projects in which we are supporting our customers to have a positive impact on the environment and society. We have adopted an ambitious environmental and climate policy under which we aim to increase our focus on financing projects which relate to sustainable development and green infrastructure.
Green Financing Framework
Arion Bank has published a Green Financing Framework which applies to the Bank’s funding and lending activities. The Framework sets out clearly and transparently the conditions which the Bank’s loans need to meet in order to be considered environmentally friendly. The Framework also specifies the Bank’s governance structure for the selection of green assets.
Arion Bank’s Green Financial Framework
Methodology Paper by Mannvit - Green Residential Buildings
Opinion from Cicero
Impact and Allocation Report 2022
Green financial services
for a sustainable future
The Green Financing Framework will form part of the Bank’s funding strategy and will be used to issue green bonds and raise green deposits. It will also enhance the Bank’s green product range, for example green loans in areas such as green energy in transportation, real estate, sustainable fisheries, emission controls and renewable energy.
Arion Bank engaged the engineering firm Mannvit to analyze the Bank’s mortgage portfolio and to determine what could be categorized as a green mortgage in Iceland. It represents the first report of its kind in Iceland and it is a vital contribution to the discussion on green buildings and their future on the domestic property market. Approximately 12% of residential housing financed by Arion Bank matches Arion Bank and Mannvit’s definition of green residential housing and environmentally certified housing.
Arion Bank’s Green Financing Framework has received a second party opinion from the Norwegian company Cicero which rates the framework as “Medium Green” and associated governance structure as ”Good“. Deutsche Bank advised on the framework as sole green structuring advisor. The Green Financing Framework is based on the latest Green Bond Principles of the International Capital Market Association, ICMA. The report also draws partially on the EU Taxonomy and the UN Sustainable Development Goals.
The framework is integral to Arion Bank’s focus on financing projects associated with sustainable development and green infrastructure. The Bank has adopted an ambitious environment and climate policy and an action plan and is committed to efforts to ensure that Iceland can meet its obligations under the Paris Climate Agreement and reach the government’s target of being carbon neutral by 2040. Arion Bank has worked with the innovation company Klappir Green Solutions to map the Bank’s carbon footprint since 2015. The Bank has now started working with Klappir to develop a solution which will enable the Bank to reliably and securely assess the carbon footprint of its loan portfolio, which builds on cooperation between all stakeholders in the value chain.