auxmoney successfully closes debut ABS with social bond label for promoting financial inclusion
auxmoney, a leading digital-lending platform for consumer credit in Europe, has successfully placed its first asset-backed security (ABS) with a volume of EUR 250 million. The transaction is labelled “Fortuna 2021 – STS German Consumer ABS”. Proceeds of the issuance are used to finance people who are often inadequately provided with credit by traditional banks.
- auxmoney has successfully placed its EUR 250 million debut securitisation with one of the first social bond transactions in Europe
- With this first deal, auxmoney is serving the high demand for ESG investments
- Proceeds from the issuance are used to provide credit to people who are underserved by banks
Düsseldorf/Dublin, 30th September 2021
auxmoney, a leading digital-lending platform for consumer credit in Europe, has successfully placed its first asset-backed security (ABS) with a volume of EUR 250 million. The transaction is labelled “Fortuna 2021 – STS German Consumer ABS”. Proceeds of the issuance are used to finance people who are often inadequately provided with credit by traditional banks. The transaction was one of the first of its kind in Europe to include securities externally certified as social bonds.
Raffael Johnen, CEO and co-founder of auxmoney, states:
“Our successful capital markets debut is a major milestone for auxmoney. With these social bonds, we underline our important contribution to the supply of credit. With our technology, we can evaluate credit requests in a more differentiated way and thus provide more people with better access to credit.”
Already in 2016, the German Bundesbank noted in a study on lending platforms that auxmoney makes an important contribution to the supply of credit to people who are underserved by banks. The lack of access to bank loans often affects the self-employed, students and trainees, employees in probationary periods and temporary employees, as well as young people and migrants with a low credit history. Through a more differentiated risk assessment, auxmoney also enables access to loans for these population groups and thus promotes financial inclusion.
Investor demand for green and social bonds has been growing strongly for years. Most of the proceeds from the issuance of social bonds flow into projects that create added value for society. With auxmoney’s first ABS transaction, about 30,000 loans with a volume of EUR 250 million will be securitised.
Daniel Drummer, CFO at auxmoney, comments:
“The award of the Social Bond label to this deal is further proof of our contribution to more inclusive access to credit. The demand from investors for ESG-compliant assets is very high. With social bonds, auxmoney offers institutional investors the opportunity to promote financial inclusion and invest according to social values.”
Boudewijn Dierick, Managing Director at auxmoney Investments, adds: “We are very pleased with the competitive pricing we have achieved in light of positive market reception. Our team is already working on placing further capital markets transactions.”
auxmoney’s social bond follows the standards defined in the International Capital Market Association’s (ICMA) Social Bond Principles (SBP). ISS Corporate Solutions (ICS) has issued a Second Party Opinion (SPO) confirming the eligibility of the security as social bond. The transaction is certified by SVI as a securitisation meeting the requirements for simple, transparent and standardised securitisation (STS). Dan Zakowski is heading the marketplace funding team at auxmoney GmbH. The securities are listed at Euronext Dublin. BNP Paribas has acted as Sole Arranger and Lead Manager.
auxmoney is a leading digital-lending platform for consumer credit in Europe. Through unique risk models and truly digital processes, auxmoney improves access to affordable credit while reducing the risk and cost of lending. auxmoney is on the forefront of promoting and improving financial inclusion.