How Nordea works with Equator Principles
Applying the Equator Principles
Nordea adopted The Equator Principles (EP). Our analysts and other relevant personnel have been trained in using the routines and tools. Internal seminars are held annually to provide staff with updates and the opportunity to knowledge sharing. Nordea follows the Equator Principles Manual (toolkit) for training and in the decision making process. The toolkit is updated as the EP develops.
Nordea evaluates the borrower’s capacity to adequately identify, mitigate and manage key social and environmental risks and impacts of the project based on documentation provided by the borrower, independent environmental and social consultants and possibly site visits. Nordea uses independent experts in category A projects, which is what the EP stipulates. Due to our relationship strategy and Nordic focus the number of projects subject to the EP tends to be small; in 2010, eight projects were assessed, six were in the energy sector, one in the mining and one in the construction industry.
The toolkit provides guidance on how to apply the EP in the day-to-day business of Nordea project finance deal managers (DM). The ten principles contained in the EP are organised into four workflow steps, 1) Initial project review; 2) Project appraisal; 3) Project negotiation, commitment and monitoring; and 4) External reporting. The steps match the Nordea project finance cycle and are integrated with the general credit evaluation and decision workflow.
Each project finance case is presented to the Nordea’s EP Advisory Group for recommendation and classification. If the recommendation is positive, the terms and conditions to participate in the project are established, including environmental and social representations and covenants.
Nordea monitors, monthly, quarterly or semi-annually, depending on type of project, the performance of all active projects in its portfolio to ensure compliance with environmental, social and other conditions. The borrower will provide annual social and environmental monitoring reports usually verified by an independent expert. In case of any non-compliance, Nordea will determine an appropriate course of action together with the other lenders.
Equator Principles Reporting 2012
| Financial Product Type | |
|---|---|
| Lending | 3 |
| Advisory | 0 |
| Total | 3 |
| EP Categories | Number of Projects |
|---|---|
| Category A | 2 |
| Category B | 1 |
| Category C | 0 |
| TOTAL | 3 |
| Industrial Sector | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
Mining |
0 |
0 |
0 | 0 |
|
Infrastructure |
0 | 0 | 0 | 0 |
| Oil&Gas, Petrochemicals | 0 | 0 | 0 | 0 |
| Power | 0 | 1 | 0 | 1 |
| Pulp and paper | 2 | 0 | 0 | 2 |
| Others | 0 | 0 | 0 | 0 |
| Total | 2 | 1 | 0 | 3 |
| Geographical areas | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
North America |
0 |
0 |
0 | 0 |
|
South America |
2 | 0 | 0 | 2 |
| Europe | 0 | 1 | 0 | 1 |
| Middle East | 0 | 0 | 0 | 0 |
| Asia | 0 | 0 | 0 | 0 |
| Asia Pacific | 0 | 0 | 0 | 0 |
| Total | 2 | 1 | 0 | 3 |
| Host Country Classification | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
High Income OECD |
0 |
1 |
0 |
1 |
|
Non High Income OECD |
2 |
0 |
0 |
2 |
|
Total |
2 |
1 |
0 |
3 |
| Category A | Category B | Category C | Total | |
|---|---|---|---|---|
|
Indepedent E&S Review |
2 |
0 |
0 |
2 |
Equator Principles Reporting 2011
| Financial Product Type | |
|---|---|
| Lending | 7 |
| Advisory | 0 |
| Total | 7 |
| EP Categories | Number of Projects |
|---|---|
| Category A | 3 |
| Category B | 1 |
| Category C | 3 |
| TOTAL | 7 |
| Industrial Sector | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
Mining |
1 |
0 |
0 | 1 |
|
Infrastructure |
0 | 0 | 0 | 0 |
| Oil&Gas, Petrochemicals | 1 | 0 | 0 | 1 |
| Power | 0 | 1 | 2 | 3 |
| Pulp and paper | 1 | 0 | 0 | 1 |
| Others | 1 | 0 | 0 | 1 |
| Total | 4 | 1 | 2 | 7 |
| Geographical areas | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
North America |
0 |
0 |
0 | 0 |
|
South America |
1 | 0 | 0 | 1 |
| Europe | 1 | 1 | 3 | 5 |
| Middle East | 0 | 0 | 0 | 0 |
| Asia | 1 | 0 | 0 | 1 |
| Asia Pacific | 0 | 0 | 0 | 0 |
| Total | 3 | 1 | 3 | 7 |
| Host Country Classification | Category A | Category B | Category C | Total |
|---|---|---|---|---|
|
High Income OECD |
1 |
1 |
3 |
5 |
|
Non High Income OECD |
2 |
0 |
0 |
2 |
|
Total |
3 |
1 |
3 |
7 |
Equator Principles Reporting 2010
| EP Category | Number of Projects |
|---|---|
| Category A | 1 |
| Category B | 6 |
| Category C | 1 |
| TOTAL | 8 |
In 2010, eight projects were assessed. Six were in the energy sector, one in the mining and one in the construction industry.
Equator Principles Reporting 2009
| EP Category | Number of Projects |
|---|---|
| Category A | 3 |
| Category B | 0 |
| Category C | 0 |
| TOTAL | 3 |
In 2009 three projects were assessed. Two of these were in the oil and gas industry and one was in the pulp and paper industry.
