NATURAL CAPITAL SOLUTIONS
The Hague, 9th May 2023: OFC announced today the financial close of the largest debt-for-climate conversion in history to protect one of the planet’s most important ecosystems: the Galapagos Islands.
The Galapagos conversion exchanged $1.628 billion in Ecuadorian government bonds for a $656 million impact loan. The transaction will generate savings to the Ecuadorian fiscus of $1.126 billion through 2041.
In return, Ecuador will direct savings of $323 million by 2041 to the conservation of the Galapagos and establish a new endowment fund maturing to $227 million to finance their preservation thereafter.
OFC played a central role in developing the transaction to fruition and contracting and coordinating the various project parties. We led on the commercial and financial structuring and ensured the project met all the required environmental and social safeguards.
The funding from the transaction is a means to an end. The key measure of success of the project will be its ability to deliver the environmental and social impacts it was designed to do. OFC will be responsible for ensuring the project delivers on these impacts throughout the lifetime of the transaction.
We invested $2 million in early-stage development capital with funding provided by our shareholder, Climate Investor Two (CI2) Fund, an innovative blended finance vehicle focused on oceans, water and sanitation. Through a complimentary structure OFC and CI2 expects to avail an additional $5 million per annum for conservation.
The Galapagos Islands, renowned worldwide for their unparalleled biodiversity and unique ecosystems, face mounting environmental and human-induced threats. In response to these pressing challenges, the Charles Darwin Foundation (“CDF”) and Oceans Finance Company (“OFC”) are delighted to announce a strategic partnership
READ MOREIn partnership with the Government of Ecuador, the U.S. International Development Finance Corporation (DFC), Inter-American Development Bank (IDB), Credit Suisse, Oceans Finance Company (OFC), and the Pew Bertarelli Ocean Legacy today announced the financial close of a $656 million Galápagos marine conservation-linked bond (Galápagos Marine Bond), arranged and structured by Credit Suisse. The Galápagos Marine Bond was used to finance a debt conversion for Ecuador exchanging $1.628 billion of Ecuador’s international bonds for an $656 million loan (the Loan). Credit Suisse acted as offeror for the international bonds.
READ MOREAS A RESULT of more than 80 years of efforts to protect the Galapagos Islands, it makes sense to associate this unique archipelago off the coast of Ecuador with environmentalism. Indeed, pursuit of this objective has brought together a consortium of actors, all with the shared aim of protecting the terrestrial and marine ecosystems which make the Galapagos Islands exceptional.
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