Wellington Airport has converted $100 million of existing bank facilities into sustainability linked loans, creating direct financial incentives by aligning lower interest rates with meeting agreed sustainability targets.
“This is about putting further weight behind our sustainability commitments,” said Martin Harrington, Chief Financial Officer, Wellington Airport. “Wellington Airport has had Kaitiakitanga sustainability goals in place for some time, and this further enhances our commitment to these goals. Reaching these ambitious targets will be a win-win for the planet and our bottom-line.”
The conversion to sustainability-linked lending means that Wellington Airport’s lending will be charged a lower interest cost and line fee for achieving the sustainability goals, and a higher rate if those goals are not achieved.
The SLLs have been executed with Wellington Airport’s entire banking group – ANZ, BNZ, MUFG and China Construction Bank, with ANZ acting as Sustainability Coordinator.
“ANZ is delighted to have acted as Sustainability Coordinator on this market-leading transaction for Wellington Airport,” said Kate Gunthorp, Director in the Sustainable Finance team at ANZ. “Decarbonising the aviation sector will be a significant challenge over the coming decades, and these SLLs have targets directly related to supporting and enabling low-emissions aircraft in Aotearoa.”
“With the support of our banking group, Wellington Airport has achieved sustainability-linked lending facilities that are customised for the sustainability challenges and opportunities in our industry and aligned with international best practice,” added Martin Harrington.
Wellington Airport’s sustainability targets are firstly to address greenhouse gas emissions that the airport is directly responsible along with supporting and enabling low-emission commercial flights through electric, hybrid and/or sustainable aviation fuelled aircraft and reducing the level of waste the ends up in landfills.
The sustainability targets were externally reviewed by Ernst & Young and align with the Asia Pacific Loan Market Association’s Sustainability-Linked Loan Principles as updated in February 2023. Wellington Airport’s performance in meeting the sustainability targets will also be independently verified.