Kuveyt Turk’s First Regulatory Capital Tier 2 ESG Trust Certificates

Akin Gump Strauss Hauer & Feld advised Kuveyt Turk on the deal.

Kuveyt Türk Katilim Bankasi A.S., one of the leading Turkish participation banks majority-owned by Kuwait Finance House, announced the landmark issuance of $350 million of fixed-rate resettable sustainability Tier 2 certificates due 2031, listed on the Irish Stock Exchange plc (Euronext Dublin).

These trust certificates are the world’s first regulatory capital Tier 2 environmental, social and governance (ESG) and Islamic compliant trust certificates. An amount equal to the net proceeds will be applied to finance and/or refinance eligible green and/or social projects in accordance with Kuveyt Türk’s Sustainable Finance Framework.

The certificates were issued on September 16, 2021, through KT21 T2 Company Limited, a Cayman Islands incorporated special purpose vehicle. The joint bookrunners were Bank ABC, Citi, Dubai Islamic Bank, Emirates NBD Capital, KFH Capital and HSBC.

The issuance was oversubscribed by 12 times with an order book of $4 billion. The issuance also achieved the tightest pricing for any Tier 2 Issuance out of Turkey since 2017 at 6.125%, reflecting strong fundamentals and positive market sentiments.

The Akin Gump team was led by partner Rizwan Kanji (Picture). In addition to Mr. Kanji, the team included counsel Hamed Afzal and associate Sahar Abas.

Involved fees earner: Sahar Abas – Akin Gump Strauss Hauer & Feld LLP; Hamed Afzal – Akin Gump Strauss Hauer & Feld LLP; Rizwan Kanji – Akin Gump Strauss Hauer & Feld LLP;

Law Firms: Akin Gump Strauss Hauer & Feld LLP;

Clients: Kuveyt Turk Katilim Bankasi A.S.;

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