Sustainable finance
Innovative strategies with long-lasting benefits.
Overview
As a major financial institution, we recognise we can help create and enable positive sustainability outcomes across climate, environmental and social objectives through our approach to sustainable finance. We have now published our approach in our Sustainable Finance Framework, which includes our Sustainable Finance Taxonomy and Targets.
How we can help
We are committed to financing activities that contribute to positive sustainability outcomes across climate, environmental and social objectives. We seek to support our people and customers as they target sustainable finance. In so doing, we can better support customers in their transition to net-zero and be their transition partner of choice.
We're partners in innovative sustainable finance solutions - find out more.
Our team
Our sustainable finance team supports sustainable business opportunities within Westpac Institutional Bank, providing:
- An understanding of the value and importance of sustainable finance to your business.
- Tailored sustainable finance solutions designed to help transition your business to a low carbon economy and achieve your climate, environmental and social goals.
- Assistance in executing the sustainable finance aspects of your transaction.
- Specialist insights regarding the rapidly changing requirements and expectations of the sustainable finance market, investors and the wider community.
- Product innovation to ensure we proactively address your evolving needs.
As a major financial institution in our region and a founding signatory of the Principles for Responsible Banking, we aspire to help set the agenda for responsible banking and lead meaningful environmental and social progress.
Sustainable finance options
Green, social, sustainability loans and bonds
Use of proceeds instruments include green, social and sustainability loans and bonds – essentially any debt instrument where proceeds are used to finance or refinance assets or projects that have been assessed and classified as Green, Transition, Social or Sustainability. Certain steps need to be undertaken for a bond or loan to be labelled as sustainable. It is important to note that all transactions must pass our usual credit risk assessment process to determine whether it can proceed.
We partner with our institutional customers to lead the transaction through each of these steps, to ensure a successful transaction, which aligns with our Sustainable Finance Framework (PDF 4MB).
Sustainability linked loans and bonds
Sustainability linked loans and bonds are general corporate purpose loans that link to the sustainability performance of the entire company with loan/bond pricing tied to this performance.
We look not only at a borrower’s financial performance, but also at its sustainability performance. This is usually measured through specific performance indicators, with the key consideration being that the chosen performance measurement is material to the borrower’s business, and that targets set are ambitious and meaningful.
We are pleased to work with our customers to determine what your pressing sustainability issues are, what you are targeting to achieve, and how we can help you to get there.
Green tailored deposits
Our Green Tailored Deposit is an innovative approach as it allows our customers to invest funds with us to support the transition to a low carbon economy. We are proud to be the first bank globally to provide such an offering to our customers.
The assets that sit behind our Green Tailored Deposits are reviewed by an external verifier on an annual basis and have been certified by the Climate Bonds Initiative. We publicly report on the underlying assets on an annual basis.
Terms are between 1 and 5 years, with a minimum transaction size of AUD $1million, flexibility in coupon payment frequency and floating or fixed rate return.
Social impact bonds
In 2013, we developed the first bank arranged social benefit bond in Australia. The $10m Benevolent Society Social Benefit Bond draws on our expertise in structured finance. The monies raised are being used to support the establishment and operation of the Resilient Families program that seeks to reduce the incidence of out of home care in New South Wales.
In 2017, we partnered with Social Outcomes to support Churches of Christ in Queensland. The $5m social benefit bond was used to fund the Youth CONNECT program in Queensland to support young people 15 to 25 years old who are exiting or have exited statutory care, and are homeless or are at risk of homelessness.
We are open to assisting interested organisations develop their own program that supports their social and community ambitions.
Who we work with
We provide strategic guidance and tailored banking solutions to Australian, New Zealand and Global customers or potential customers of Westpac Institutional Bank.
Fundamental to our approach is a commitment to sustainability and service, which we leverage to understand the sustainability and banking objectives of each client so we can bring the right solution to the table.
See what we’re doing to drive Westpac’s sustainability strategy forward.
Sustainable Finance Market Update - Q1 25
In this quarter's Sustainable Finance Market Update, we delve into the market movements in the volatile first months of 2025. We also provide updates on recent transactions, updates of the Loan Principles that govern sustainable finance loan markets, as well as in the industry, including economic research on Blue economy and a special report on how the Australian Carbon Market is evolving.
Q4 2024 Sustainable Finance Market Update
In Q4 2024's Sustainable Finance Market Update, we cover trends in sustainable debt issuance globally and in the Australian-New Zealand markets, as well as industry insights such as updates to the Green Star Performance for building sustainability and ASFI’s progress on the Australian Sustainable Finance Taxonomy.
Sustainable Finance Market Update
In this quarter’s Sustainable Finance Market Update, we cover trends in sustainable debt issuance globally and in the Australian-New Zealand markets, as well as industry insights such as updates to the Green Star Performance for building sustainability and ASFI’s progress on the Australian Sustainable Finance Taxonomy.
Things you should know
Westpac Institutional Bank’s financing exposures are not limited to green and sustainable financing. For more details of Westpac Institutional Bank’s financing exposures please see our latest presentation and results (PDF 5MB).
Westpac Institutional Bank is a division of Westpac Banking Corporation ABN 33 007 457 141 AFSL 233714. This product is available only to wholesale clients within the meaning of s761G of the Corporations Act 2001. You should consider whether or not this product is appropriate for you. Terms and conditions apply. Copyright 2023 Westpac Banking Corporation.