A new €305 million bond of the Zagreb Holding multi-utility conglomerate was listed on the Zagreb Stock Exchange (ZSE) on Wednesday as the first sustainability bond on the domestic capital market from the public sector.

An agreement on the listing was signed by ZSE CEO Ivana Gazic and Holding CEO Ivan Novakovic, with Zagreb Mayor Tomislav Tomasevic present.

The bond was issued at a fixed annual interest of 4.9% and five years’ maturity.

Investors’ interest exceeded €480 million. The European Bank for Reconstruction and Development and the International Finance Corporation also participated, achieving a 47.5% share in the issue. The share of domestic commercial banks is 34% and that of voluntary pension funds 15.6%.

The issue was arranged by the Erste, PBZ and ZABA banks.

ZH said earlier it would use the net income from this issue to refinance €305.4 million worth of bonds due on 15 July.

As sustainability goals, ZH has set increasing the share of sorted waste to 58% by 2027 and the share of renewable electricity to 70% for a period of 12 months ending on 31 March 2028.

Tomasevic said interest in the first sustainability bond on the domestic stock market from the public sector had been 60% above expectations. He is confident the plans related to the bond will be realised and contribute to higher waste sorting and use of renewables.

Tomasevic said he was pleased the bond attracted the EBRD and the IFC, and that each subscribed €70 million. The City of Zagreb will always support Zagreb Holding, he added.

Gazic underlined the importance of the City of Zagreb guarantee for the bond, saying it makes it a corporate as well as a municipal bond, and that she would like to see other cities’ bonds listed on the ZSE

The ZSE, she said, “wants to actively participate in the idea of Zagreb as the centre of sustainability in the region as well as of the capital market, and to be the leading stock exchange in the region.”