Cleary Gottlieb represented the underwriters, led by Citigroup Global Markets Inc., in Citigroup Inc.’s (Citi) first social finance bond offering of $1 billion of fixed-rate/floating-rate social finance notes due 2025 and concurrent offerings of $1.75 billion of fixed-rate/floating-rate notes due 2032 and $1.25 billion of fixed-rate/floating-rate notes due 2042, all to be issued on November 3, 2021.
The securities were offered for sale in the United States, Europe, Asia, and elsewhere. The interest payment calculation for the notes during the floating-rate period will be based on the secured overnight funding rate (SOFR) compounded daily over each quarterly interest period. SOFR is the rate that currently is replacing LIBOR in the capital markets.
An amount equal to the net proceeds of the sale of the social finance notes due 2025 will be allocated exclusively to finance or refinance in whole or in part a portion of Citi’s or its subsidiaries’ portfolio of assets that meet Citi’s social finance asset portfolio eligibility criteria and do not meet any of the exclusionary criteria in accordance with Citi’s social finance framework. Citi has developed the social finance framework for notes issuances in order to support lending to social inclusive businesses across its emerging market footprint.
This is one of several recent green and sustainability offerings handled by Cleary, including Alphabet’s first sustainability bond, Citi’s inaugural U.S.-denominated green bond and affordable housing bond, Verizon’s green bond, and Suzano’s first-ever sustainability-linked notes and concurrent tender offer.