Mercedes Issues its First Green Panda Bond to Expand Sustainable Finance in China

German automaker Mercedes-Benz successfully issued its first Green Panda Bond on November 24, 2022 with a size of RMB 500 million (approx. EUR 68 million), a term of two years and a coupon rate of 2.9% in the Chinese Interbank Bond Market.

The bond, which was 3.1 times oversubscribed is guaranteed by Mercedes-Benz Group AG (ticker symbol: MBG). The issuance was arranged by Bank of China and HSBC.

It is Mercedes-Benz’s first Green Bond outside of the European market and Mercedes-Benz is the first automotive company to issue a Green Panda Bond in China.

The bond was issued in line with China domestic Green Bond standards and with the Mercedes-Benz Ambition 2039. Net proceeds will go to Mercedes-Benz subsidiary Mercedes-Benz Leasing Co located in in China, which will use these funds for financing new customer leasing contracts with Battery Electric Vehicles.

“The first Mercedes-Benz Green Panda Bond shows our ambition to further expand our sustainable finance strategy to our important growth regions around the globe,” said Steffen Hoffmann, Head of Treasury and Investor Relations of Mercedes-Benz Group AG.

Since 2014, Mercedes-Benz Group AG has issued 35 tranches with a total amount of RMB 81 billion (approx. EUR 11 billion), promoting the development of the Panda Bond market.

The issuance of the Green Panda Bond is not only an effective extension of Mercedes-Benz Group’s sustainable business strategy, but also a brand-new green finance exploration to the Chinese market. At the same time, the Green Panda Bond further reflects the openness and innovation of the Chinese capital market in ESG sectors.

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