First U.S. bank holding company with under $150 billion in consolidated total assets – and eighth overall – to issue a bond with proceeds dedicated to financing the clean energy transition
CHEVY CHASE, Md.–(BUSINESS WIRE)–Forbright Inc., recently rebranded from Congressional Bancshares, Inc., or Forbright, announced today the completion of the private placement of its inaugural Green Bond, offering $125 million in fixed-to-floating rate subordinated notes due January 1, 2031. The bond was issued by the bank holding company, and the proceeds will be injected into the bank as capital and used to finance or refinance projects aimed at driving decarbonization and accelerating the shift to a more sustainable economy.
Forbright is the first U.S. bank holding company with under $150 billion in consolidated total assets, and only the eighth financial institution overall, to issue a Green Bond. This is a significant step toward achieving Forbright’s commitment to be the first full-service U.S. bank mission-aligned around sustainability and decarbonization.
“We launched Forbright to empower our customers, partners, and stakeholders to contribute directly to a more sustainable future and seize the tremendous investment opportunities presented by decarbonizing the economy. Our first Green Bond is one way we are delivering on that promise,” said founder and Executive Chairman John Delaney.
Forbright’s Green Financing Framework will guide the selection and management of projects funded by net proceeds from the Green Bond offering. Sustainalytics, an experienced global leader in high-quality environmental, social, and governance (ESG) research, ratings, and data, has independently verified that Forbright’s Green Financing Framework “is credible and impactful and aligns to the four core components” of the International Capital Market Association’s (ICMA) Green Bond Principles 2021 (GBP). Financed projects will focus on the Eligible Project Categories of Renewable Energy and Energy Efficiency, seeking to reduce greenhouse gas emissions and the consumption of fossil fuels, in furtherance of United Nations Sustainable Development Goal 7 (Affordable and Clean Energy).
In September, Forbright became just the seventh U.S. bank to sign onto the UN Principles for Responsible Banking, the preeminent global framework for a sustainable banking industry. To maintain transparency as net proceeds from the Green Bond offering are allocated, Forbright intends to publish on at least an annual basis a report describing the amount of net proceeds allocated by Eligible Project Category, descriptions of specific projects financed, achieved or expected impact metrics, as feasible, and unallocated balances.
“We are proud to provide investors an avenue to align with a values-driven organization committed to a brighter, greener future while meeting their investment objectives, and also to offer borrowers the capital they need to finance their clean energy initiatives,” added Forbright Bank Chief Executive Officer Don Cole. “This offering fully reflects our belief that banking with a sustainability focus is good for our customers, our investors, our business, and society.”
For the Green Bond private placement offering, Keefe, Bruyette & Woods, A Stifel Company; and PNC FIG Advisory, part of PNC Capital Markets LLC, served as Placement Agents. PNC Capital Markets LLC served as the ESG Structuring Agent. Holland & Knight LLP served as legal counsel to Forbright, and Squire Patton Boggs (US) LLP served as counsel to the placement agents.
This press release is for informational purposes only and shall not constitute an offer to sell, or the solicitation of an offer to buy, the Green Bond, nor shall there be any offer, solicitation, or sale in any jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The Green Bond has not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. The indebtedness evidenced by the Green Bond is not a deposit and is not insured by the FDIC or any other government agency or fund.
Forbright Inc., rebranded from Congressional Bancshares, Inc., is the bank holding company for Forbright Bank. Forbright Bank (www.forbrightbank.com), rebranded from Congressional Bank, Member FDIC, is a full-service bank, commercial lender, and asset manager headquartered in Chevy Chase, Maryland, that is committed to accelerating the transition to a sustainable, clean energy economy by financing the companies, investors, and innovators driving that change. With approximately $6 billion of owned and managed assets, the Bank provides lending, banking, and asset management services to clients across the United States. Its business banking group provides nationwide lending products, including real estate loans, working capital, warehouse lines of credit, term loans, and forward loan purchase agreements to entrepreneurs, growing middle market companies, and sophisticated investors and operators in clean tech, healthcare, financial services, technology, real estate, renewable energy, and other industries where a trusted and highly responsive lender is needed. The Bank provides sophisticated and competitive deposit products, which will soon include deposits linked to decarbonization- and sustainability-oriented loans, to businesses and individuals.
Member FDIC as Congressional Bank. Congressional Bank is an equal housing lender and makes loans without regard to race, color, religion, national origin, sex, handicap, or familial status.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions, or future events or performance are not historical facts and may be forward-looking. Words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends,” and similar words or phrases are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. The inclusion of or reference to forward-looking information in this press release should not be regarded as a representation by us or any other person that the future plans, estimates, or expectations contemplated by us will be achieved. We have based these forward-looking statements on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of risks, uncertainties, and assumptions that are difficult to predict, including the difficult market conditions and unfavorable economic conditions and uncertainties associated with the COVID-19 pandemic, including the emergence of variant strains of the virus, particularly in the markets in which we operate and in which our loans are concentrated, including declines in housing markets, an increase in unemployment levels, and slowdowns in economic growth; our expected future financial results; the overall health of the local and national real estate market; the credit risk associated with our loan portfolio, such as possible additional loan losses and impairment of collectability of loans as a result of the COVID-19 pandemic and policies and programs implemented by the Coronavirus Aid, Relief, and Economic Security Act, including its automatic loan forbearance provisions and the effects on our loan portfolio from our Paycheck Protection Program lending activities, specifically with our commercial real estate loans.
If one or more events related to these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. Furthermore, many of these risks and uncertainties are currently amplified by and may continue to be amplified by or may, in the future, be amplified by, the COVID-19 pandemic, including the emergence of variant strains of the virus, the pace at which the COVID-19 vaccine can be distributed and administered to residents of the markets we serve and the United States generally, and the impact of varying governmental responses that affect our customers and the economies where they operate. You are cautioned not to place undue reliance on forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by law.
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