Aib Group Plc · EURONEXT:A5G
Aib — Debt Investor Presentation (April 2024)
34 slides from Aib's debt investor presentation, April 2024
Slide 1: Social Bond Investor Presentation
For the future you’re after AIB Group plc Social Bond Investor Presentation April 2024 1
Slide 2: Contents
Contents Page # • Sustainability Strategy, Targets & Progress 3 • Journey to Net Zero 6 Own Operations & Financed Emissions (Scope 1, 2 & 3) Climate and Environment Risk ESG Customer Propositions • ESG Ratings 11 • Social Bond Framework & SPO 13 • Allocation and Impact Reporting 20 • Appendix 23 Sec
Slide 3: Backing a Sustainable Future – FY2023
Backing a Sustainable Future – FY2023 Helping to deliver a more sustainable future for all is at the heart of AIB’s agenda As a recognised leader of sustainability in Ireland and through our Pledge to Do More, we are committed to building long- term resilience and sustainability for our business, ec
Slide 4: ESG Progress to year end 2023
ESG Progress to year end 2023 2023 PLEDGE TO DO MORE Impact area Targets Performance at year end 2023 • €5bn Climate Action Fund launched 2023: 10bn Climate Action Fund €11.6bn in Green lending since 20191 in new green & transitional lending 2019 • Green Mortgage (€2bn per year) €3.7bn Green lending
Slide 5: Our Sustainability Strategy 2024-2026
Our Sustainability Strategy 2024-2026 With a new segment dedicated to Climate Capital from 2024, sustainability remains at the very core of AIB Group’s strategy. Our Climate Capital segment, alongside our other segments, will increase our capability, support business growth, and demonstrate our posi
Slide 6: Journey to Net Zero: Scope 1 & 2 Targets Actions
Journey to Net Zero: Scope 1 & 2 In 2020, AIB became the first Irish bank to pledge to operate as carbon neutral by 2030, using a net zero approach Transitioning our own operations to net zero by 2030 Operational Emissions Progress virtual Corporate Power Purchase – aligned to 1.5°C target Agreement
Slide 7: Journey to Net Zero: Scope 3 Targets Actions
Journey to Net Zero: Scope 3 Supporting customers in the transition to a greener future, we are targeting 70% of new lending to be green or transition, by 2030, and for our entire lending portfolio to be net zero by 2040 (agri by 2050) Supporting our Customers to achieve their net zero ambitions • A
Slide 8: Climate & Environmental Risk Management (1/2)
Climate & Environmental Risk Management (1/2) Significant steps taken to analyse Physical & Transition Risks in 2023 The management of climate risk is integrated into our overall approach to risk management, as set out in our TCFD disclosures in our Annual Financial Report 2023. The below table summ
Slide 9: Climate & Environmental Risk Management (2/2)
Climate & Environmental Risk Management (2/2) Highlights of AIB’s approach to managing Climate Risk Recognising its importance as a key strategic pillar, as well as its Transition Risk potentially significant impact over time on the Group and wider society, the Board Risk Committee reviewed Climate
Slide 10: Market Leading ESG Customer Propositions & Disclosure Transparency
Market Leading ESG Customer Propositions & Disclosure Transparency Propositions Ratings Green Mortgage for energy Widescale lending for projects efficient homes across AIB, in Renewables, Housing, Haven, EBS brands & UK Healthcare, Education 12.7 Sustainalytics Green Personal Loan for Sustainable Le
Slide 11: ESG Ratings
ESG Ratings AIB's Sustainability Performance Assessed by Key Agencies Our performance continues to be recognised by independent ESG rating agencies where we hold leadership positions: On 04 May 2023 AIB received an ESG Risk Rating of 12.7, was assessed by Morningstar Sustainalytics to be at Low Risk
Slide 12: AIB Social Bond Framework
AIB Social Bond Framework April 2024 12
Slide 13: Social Bond Framework
Social Bond Framework • Being a responsible member of society is a cornerstone of AIB’s business. We believe that Social Bond financing offers a way Rationale to create transparency around funds targeted to provide positive societal impact and/or mitigate social problems. 1 2 3 4 5 Project Evaluatio
Slide 14: Use of Proceeds 2024
Use of Proceeds 2024 Social & Affordable Housing Access to Healthcare Access to Education SME Financing Use of Proceeds Use of Proceeds Use of Proceeds Use of Proceeds a) Housing organisations: Loans to housing bodies, a) Healthcare facilities: Loans dedicated to the a) Education facilities: Loans d
Slide 15: Use of Proceeds – Social Impact Matrix
Use of Proceeds – Social Impact Matrix SBP category SBP Sub-category Target Population Social Benefits / Objectives Alignment with National Policy Frameworks • Increase access to quality, timely and accessible • Irish National Treatment Purchase Fund (NTPF) Access to Healthcare Hospitals • General p
Slide 16: Process for Project Evaluation and Selection - Overview
Process for Project Evaluation and Selection - Overview Process for Project Evaluation and Selection Compliance with ICMA Social Bond Eligibility Criteria (i.e. Use of Proceeds) Alignment with AIB’s sustainability strategy Compliance with official and international environmental and social standards
Slide 17: Selection Process for SME Financing in Deprived Areas
Selection Process for SME Financing in Deprived Areas Eligibility Criteria Background of Pobal HP Deprivation index* 1. Be an SME as per EU Commission definition. ✓ The Pobal HP Deprivation index is Ireland’s most widely used social gradient metric, which scores each Small Area (min. 50 – 2. Not be
Slide 18: Second Party Opinion
Second Party Opinion ISS-Corporate has issued a positive Second Party Opinion on AIB’s Social Bond Framework Use of Proceeds – Aligned: The Use of Proceeds description provided by AIB’s Social Bond Framework is aligned with CONTRIBUTION the ICMA Social Bond Principles. The issuer’s social categories
Slide 19: Management of Proceeds at YE 2023
Management of Proceeds at YE 2023 AIB intends to be fully allocated at issuance for new social bonds, as well as having an over-collateralised social portfolio Aggregated portfolio approach used to manage proceeds Additional eligible social projects are added to the eligible social loan portfolio to
Slide 20: Social Bond Portfolio & Impacts FY2023
Social Bond Portfolio & Impacts FY2023 AIB Eligible Social Loan Portfolio FY23 # € % Access to Education 20 408m 13% Access to Healthcare 155 1,371m 43% Social & Affordable Housing 163 760m 24% SME Financing 13,545 620m 20% Affordable Basic Infrastructure 3 11m <1% Total 14,061 3,170m 100% Pre-issua
Slide 21: Social Bond Case Study – Valley Healthcare
Social Bond Case Study – Valley Healthcare Access to Healthcare – Primary Care Centres Project Ireland 2040 is the Irish government’s long-term overarching strategy to make Ireland a better country for its citizens. Core to this is Slaintecare – a government-led initiative focussed on ensuring that
Slide 22: External Review: Independent Limited Assurance
External Review: Independent Limited Assurance Independent Limited Assurance Report to AIB Work Performed AIB engaged Mazars, a leading international audit, tax, advisory and consulting Mazars was required to plan and perform work in order to consider the risk of firm, to perform a review to facilit
Slide 23: Appendix
Appendix For the future you’re after 23
Slide 24: Journey to Net Zero: Sector Transition Pathways (1/2)
SBTi Journey to Net Zero: Sector Transition Pathways (1/2) validated In 2022, we set financed emissions targets for three sectors using a Sector Decarbonisation Approach (SDA), and a fourth Corporate Portfolio Coverage Target all of which have been validated by SBTi. Residential Mortgages In 2021, w
Slide 25: Journey to Net Zero: Sector Transition Pathways (2/2)
SBTi Journey to Net Zero: Sector Transition Pathways (2/2) validated Electricity Generation In 2021, we set a baseline maintenance target of 21 gCO2e/kWh, vs Global 2023 463.7 gCO2e/kWh. Our Electricity Generation portfolio comprised 3% of total lending at €1.6bn in 2021. In 2023, the portfolio incr
Slide 26: Journey to Net Zero: Agriculture
Journey to Net Zero: Agriculture In line with the Irish Government’s targets, AIB strive to meet net zero for the Agricultural sector by 2050. A focus on Agri Collaboration Farm Zero C Project Dedicated Agri Advisors In July 2023, AIB became the exclusive financial institution partner with the Farm
Slide 27: Biodiversity: Protecting and Safeguarding Nature
Biodiversity: Protecting and Safeguarding Nature Although at the early stages of the biodiversity journey, the financial sector has a key role to play in providing responsible finance and investment to support nature-positive funding, while reducing financial flows that harm nature. Our Approach Was
Slide 28: ESG Governance at AIB
ESG Governance at AIB Our strong governance structures and frameworks are key to delivering our strategy. AIB’s Board of Directors has established a number of Board and Board Advisory Committees to assist in the discharge of its duties, including in overseeing and challenging the Group’s sustainabil
Slide 29: Commitments, Memberships & Partnerships
Commitments, Memberships & Partnerships Key voluntary commitments made by AIB, relevant to our Sustainability Strategy and Reporting: Date of Applicable Governance Funding Beyond Strategic Commencement Stakeholders countries Website Association Position Active Membership Alignment 30% Club N Y N Y C
Slide 30: Our Policies and Frameworks
Our Policies and Frameworks Name of Statement Name of Statement Code/Policy/Framework Name Link to website if publicly available Code/Policy/Framework Name Link to website if publicly available provided publicly provided publicly Anti-Bullying & Harassment Policy https://aib.ie/sustainability AIB Gr
Slide 31: Impact Reporting – SME Financing
Impact Reporting – SME Financing SMEs Financing Total jobs impacts of outstanding term loans (left) and RCFs (right) by Target Group sector • SMEs in socio-economically disadvantaged areas in 5,848 Ireland Estimated number of jobs created/enabled Agriculture, forestry and shing 1409 Wholesale and re
Slide 32: Contact Details
Contact Details Mark Whelan Head of Funding and Liquidity Mark.A.Whelan@aib.ie +353 1 772 4027 Eoin Moore Head of Term Funding Eoin.P.Moore@aib.ie +353 1 772 4027 Maddison Hampson Treasury Manager, ESG Term Funding Maddison.P.Hampson@aib.ie +353 1 772 4027 Grace Loring Treasury Manager, ESG Term Fun
Slide 33: Disclaimer (1/2)
Disclaimer (1/2) THIS DOCUMENT IS INTENDED TO PROVIDE NON-EXHAUSTIVE, GENERAL INFORMATION. THIS DOCUMENT MAY CONTAIN OR INCORPORATE BY REFERENCE PUBLIC INFORMATION NOT SEPARATELY REVIEWED, APPROVED OR ENDORSED BY AIB AND ACCORDINGLY, NO REPRESENTATION, WARRANTY OR UNDERTAKING, EXPRESS OR IMPLIED, IS
Slide 34: Disclaimer (2/2)
Disclaimer (2/2) THIS DOCUMENT REPRESENTS CURRENT AIB POLICY AND INTENT AS AT THE DATE OF THIS DOCUMENT AND IS SUBJECT TO CHANGE WITHOUT NOTICE AND IS NOT INTENDED NOR CAN BE RELIED ON, TO CREATE LEGAL RELATIONS, RIGHTS OR OBLIGATIONS. ANY DECISION TO PURCHASE ANY AIB SOCIAL BONDS SHOULD BE MADE SOL