African Development Bank First Investor to Commit to TDB Class C Green+ Shares Launched at COP27 | African Development Bank

The African Development Bank and the Eastern and Southern African Trade and Development Bank (TDB) have teamed up to launch a unique financial tool to catalyze finance for sustainable development on the continent.

At the ongoing global climate summit, COP27, the African Development Bank announced an investment commitment of $15 million in TDB’s Class C Green+ Shares on Wednesday.

This is the first equity vehicle of its kind that offers institutional investors the opportunity to support climate action with venture capital, with every dollar invested being matched four times towards eligible projects and transactions. More broadly, the shares are intended to accelerate TDB’s financial innovation and contributions to the Sustainable Development Goals (SDGs), the African Union’s 2063 Agenda and the Paris Agreement on Climate Change.

About a decade ago, as the international community embarked on the 2030 sustainable development agenda and advocated for institutional investors to invest in sustainable assets, TDB launched its Class B shares targeting pension funds, sovereign wealth funds and others. The African Development Bank took the lead and became the first investor in Class B shares. The launch of Class B has been a huge success and today TDB counts 20 institutional investors as part of its shareholder community, which now represents approximately one-third of TDB’s total paid-up shareholder capital.

Admassu Tadesse, TDB Group President Emeritus and Managing Director said: “We are grateful for the pioneering role of the African Development Bank in launching this new instrument, which is already generating a great deal of interest from other investors. Building on the successful green bond model, this catalytic paid-equity investment will strengthen TDB’s capital position and enable us to increase our climate impact. Together we make African capital work for Africa’s development, while achieving competitive returns.”

Akinwumi Adesina, Chairman of the African Development Bank Group said: “This is a great innovation that will push public development banks and other financial institutions to do more to expand climate finance and green growth. The African Development Bank Group will mobilize investment partners for the Trade and Development Bank and help replicate it with other financial institutions. We want to green Africa’s financial systems”

In addition to crucial reforms implemented over the past decade, the diversification of TDB’s capital structure has enabled TDB to continue mobilizing debt capital on increasingly attractive terms, obtaining an investment grade rating and increasing its impact in the region it serves. Class C Green+ Shares are senior and shareholders will receive annual dividends in the same manner as existing Class B Shareholders. Building on TDB’s successful track record of generating double-digit returns on equity and development impact on a triple bottom-line basis, Class C Green+ Shares are another step in the right direction.

About TDB

Established in 1985, the Eastern and Southern African Trade and Development Bank (TDB) is a multilateral, treaty-based, investment grade development finance institution, with 44 sovereign and institutional shareholders and assets of US$8 billion. TDB serves 23 economies in its region, with a mandate to finance and promote trade, regional economic integration and sustainable development.

TDB is part of the TDB Group, which also includes the Trade and Development Fund (TDF), Eastern and Southern African Trade Advisors Limited (ESATAL), TDB Captive Insurance Company (TCI) and the TDB Academy.

www.tdbgroup.org