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Chile places its first Sustainability Linked-bond in UF
10/19/2023 Since 7 months

The Government of Chile, through the Ministry of Finance, has issued its first sustainability-linked bond (SLB) in Units of Account (known as UF), for an amount equivalent to approximately 927 million dollars. The transaction was oversubscribed by 3.2 times the amount placed.

The interest rate on the SLB bond could be subject to increases in the future (up to 0.075% per annum from October 2034), based on Chile’s non compliance with two objectives:

1) Compliance with two committed objectives by Chile in its Nationally Determined Contribution (NDC) under the Paris Agreement:
– achieve annual GHG emissions of 95 tons CO2e before December 31st, 2030
– achieve a maximum GHG budget of 1,100 MtCO2e between January 1st, 2020 and December 31st, 2030.

2) Achieve an average participation of at least 40% of women with respect to the total positions on the boards of directors of reporting companies subject to the Financial Market Commission supervision, as of December 30th, 2031.