Banco Santander

Green Bond

Report

2019

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Index

1. Introduction

3

2. Overview of Banco Santander's Global Sustainable Bonds

Framework

4

3. Calculation Methodology

5

4. Banco Santander first green bond key figures

7

5. Banco Santander's green bond allocation and impact report

8

6. Disclaimer

14

7. Annex

16

I. IEA emission factors

  1. Green bonds issued and guaranteed by Banco Santander S.A.
    III. PwC Independent Limited Assurance Report

2

Green Bond Report 2019

1. Introduction

1. Introduction

Santander strongly believes it must use its position as one of the world's largest banks to pursue its objective of helping people and businesses prosper, of delivering profit with purpose. For this reason, the Group has voluntarily undertaken a series of economic, social and environmental commitments which go beyond legal obligations to its stakeholders: customers, employees, shareholders, suppliers and society as a whole.

In 2019 the Bank set 11 targets which reflect Santander's commitment to help address the UN Sustainable Development Goals and Paris Agreement, in order to build a more responsible bank. These targets include a new commitment to mobilise over EUR 120 billion in green financing between 2019 and 2025 (EUR 220 bn by 2030) to combat climate change. During the UN Climate Change Conference (COP25) Santander announced its commitment to become carbon neutral in 2020 by offsetting all the emissions generated by its own operations. Moreover, Santander signed, as founder member, the UN Principles for Responsible Banking as well as the Collective Commitment to Climate Action, in order

to align its lending portfolio with the Paris Climate Agreement.

Santander is already one of the largest providers of green finance in the world and will continue to increase its involvement to support the transition towards a sustainable production model.

A good example of this was the development of the Santander Sustainability Bonds Framework and the issuance of its first green bond - a tangible way to support its strategy and meet the targets for new green investments.

In October 2019, the Bank initiated its global sustainable issuance plan with a seven year, EUR 1 bn green bond to fund wind and solar power projects. More recently, in June 2020, Banco Santander S.A. issued its second green bond, a 7-year, EUR 1 bn senior non-preferred issuance.

More information on Santander´s approach and performance in sustainable and climate finance can be found in the 2019 Climate Finance Report. For additional information on how Grupo Santander conducts business please refer to its policies.

3

2. Overview of Banco Santander's Global Sustainable Bonds Framework1

In 2019 a Global Sustainable Bonds Framework1 and a Global Green Bonds Framework1 were developed in line with the Green and Social Bond Principles 2018. These frameworks are aligned with and support Banco Santander´s Responsible Banking strategy and reflects its intention to deploy additional capital for green, social and sustainable projects. The Global Sustainable Bonds Framework1 enables the issuance of Green Bonds, Social Bonds and Sustainable Bonds that align finance-raising activities with sustainable development and the bank's commitment to a more inclusive and sustainable growth. An update to both frameworks was disclosed on 2020.

Santander will confirm on an annual basis that the use of proceeds of each Green Bond issuance conforms to this Green Bonds Framework1.

The annual reporting for every Green Bond issuance will include:

  • The amount of proceeds allocated to the Eligible Green Assets.
  • The amount of proceeds not yet allocated to the Eligible Green Assets.
  • Details on the Eligible Green Assets financed or refinanced by the bonds, such as:
    • Technology (solar, wind, etc...).
    • Location.
    • Operational status (under construction or in operation).
    • Outstanding exposure.
    • Installed capacity or installed projected capacity (MW), and annual energy produced or projected energy produced (MWh).
  • Information on the environmental impacts: annual CO2 emissions reduced/avoided as per the following methodology described below.
  • The share of new financing compared to already existing financings.
  • The indicators will be based on Eligible Green Assets allocated on or prior to 31st December of the year immediately preceding the issuance of each report.
  • Assets data will be anonymised for confidentiality reasons.

The tracking and allocation of funds from the Green Bond proceeds will be externally verified by the financial auditor assuring compliance with Banco Santander S.A. Green Bonds Framework. The Independent Limited Assurance Report will be issued as an independent review report2.

  1. For more details please refer toGlobal Sustainable Bonds Frameworkand/orGreen Bonds Framework.
  2. Please refer to Annex III. PwC Independent Limited Assurance Report.

4

Green Bond Report 2019

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Disclaimer

Banco Santander SA published this content on 26 November 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 November 2020 11:38:02 UTC