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Green bond framework of Municipality Credit Iceland

Municipality Credit Iceland (MCI) has received certification of its green bond framework to issue green bonds. By offering green loans, MCI aims to encourage municipalities to more selectively choose environmental-improving projects that minimise climate change in accordance with the MCI’s environmental policy.

The projects financed with green bonds must meet the requirements set in the MCI’s green bond framework which is based on the Green Bond Principles issued by the International Capital Market Association (ICMA). They in turn build on the following pillars:

  • Allocation of funds
  • Project selection and evaluation process
  • Financial management
  • Information provision

The framework has been rated by Sustainalytics, a leading global provider of ESG ratings. According to the rating, the MCI’s framework is credible, effective, transparent and in line with ICMA’s aforementioned guidelines. .

Environmental transportation, eco-friendly buildings, renewable energy and energy efficiency, waste water disposal and waste treatment are examples of investments that could qualify for financing under the framework.

Landsbankinn's Markets division assisted the MCI in preparation of the framework, as well as in the sale and issuance of green bonds.

Óttar Guðjónsson, Managing Director of the MCI “It is important to the MCI to be able to actively participate in the municipalities’ initiatives in aid of the environment and climate. The MCI intends to support the government’s aims in relation to the UN's Sustainable Development Goals. The cooperation with Landsbankinn has been invaluable and we look forward to taking the next steps.”

Hrefna Ösp Sigfinnsdóttir, Managing Director of Landsbankinn Markets: “Capital markets play an important role in promoting the issuance of green bonds. Landsbankinn has in recent years emphasised responsible investment. As an asset class, green bonds constitute a responsible investment tool and it has therefore been especially pleasing to participate in this journey with MCI.”

MCI Green Bond Second Party Opinion

MCI Green Bond Framework