Spark Finance issues first Sustainability-Linked Bond

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand


MARKET RELEASE
23 March 2022

Spark Finance issues first Sustainability-Linked Bond
Spark Finance Limited, the wholly owned subsidiary of Spark New Zealand Limited
that carries out the borrowing activities for the Spark group (“Spark”), announced
today that it successfully completed a bookbuild for a 6.5-year NZ$100m
Sustainability-Linked Bond to institutional investors. The domestic notes will mature
on 29 September 2028 and will pay an interest rate of 4.37% per annum. The
bonds are expected to be rated A- by S&P.

To support both this transaction and any further sustainably linked financing that
Spark may choose to undertake in future, Spark ha s established a Sustainable
Finance Framework, which is closely aligned to its Sustainability Framework. Spark’s
Sustainable Finance F ramework outlines the company’s sustainable financ ing focus
areas and the process by which Spark intends to issue and manage bonds and/or
loans that are linked to the achievement of sustainability outcomes.

For its Sustainability-Linked Bond (SLB), Spark has selected one timebound
Sustainability Performance Target (SPT) to reduce absolute Scope 1 and Scope 2
Greenhouse Gas emissions. The SLB target is informed by Spark’s Science Based
Target (SBT) that has been verified by the Science Based Target initiative (SBTi) to
reduce absolute Scope 1 and Scope 2 Greenhouse Gas emissions by 56% by FY30
from an FY20 baseline. The target reflects material ambition in relation to current
performance and is consistent with Spark’s business strategy.

The SLB includes a financial impact that is dependent on the achievement of the SPT
as at 30 June 2026. Should Spark fail to meet its emissions reduction target, a
premium pricing adjustment in the form of an interest rate step will occur and will
apply until maturity.

Stefan Knight, Spark Finance Director, says: “Spark Finance is pleased to issue New
Zealand’s first Sustainability-Linked Bond, following the refinancing of three existing
loans to incorporate a Sustainability-Linked Loan structure back in November 2021.
Sustainable finance is one way we can demonstrate our commitment to supporting
Aotearoa’s decarbonisation and continuing to work hard to improve our own
environmental performance.”

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand



ANZ Head of Sustainable Finance, Dean Spicer, says: “ANZ is proud to have
supported Spark on the completion of the first Sustainability-Linked Bond, which is
an important development of the sustainable finance market in Aotearoa New
Zealand. ANZ commends Spark for demonstrating its commitment to sustainability
through this transaction.”

Details of Spark’s Sustainability-Linked Bond:
Issuer Spark Finance Limited
Description
Unsecured, unsubordinated, Sustainability-Linked
fixed rate bonds
Credit Rating
Issuer credit rating A- (stable) (Standard & Poor’s)
Expected credit rating for Sustainability Linked Bonds:
A- (Standard & Poor’s)
Issue Amount Up to NZ$100,000,000
Term 6.5 years, maturing 29 September 2028
Sustainability
Performance Target
To help achieve Spark’s SBT by reducing absolute
Scope 1 and Scope 2 emissions by a specified
percentage by FY26 against a FY20 baseline
SPT Observation Date 30 June 2026
Performance
Threshold Premiums
The SLB includes a financial impact depending on the
achievement of the SPT as at 30 June 2026. Should
Spark fail to meet its specified emissions reduction
target, a premium pricing adjustment in the form of
an interest rate step up will occur and will apply until
maturity. Any interest rate step up will be applied at
the commencement of the next interest period.

Interest Rate 4.37% per annum
SPT Notification Date 28 September 2026

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand


Interest Rate Step Up
(if applicable)
Being the period beginning on the Interest Rate Step
Up Date (being the day after the Interest Payment
Date scheduled to occur on 29 September 2026) and
will apply for each subsequent payment date up to
and including 29 September 2028.
Purpose General corporate purposes
Arranger and
Sustainability
Coordinator
ANZ Bank New Zealand Limited
SLB Framework
The Sustainability-linked Bond is aligned with Spark’s
Sustainable Finance Framework dated March 2022.
Spark’s Sustainable Finance Framework will be made
available to investors as part of the SLB materials and
will be made available on the Spark Finance Bonds
section of Spark’s investor centre website:
investors.sparknz.co.nz

• ANZ Bank New Zealand Limited (ANZ), Bank of New Zealand (BNZ) and Westpac
New Zealand Limited (Westpac) together were appointed as Joint Sustainability
Coordinators for the purposes of establishing the Sustainable Finance
Framework.
• DNV provided a Second Party Opinion on the Sustainability-Linked Bond and the
Sustainable Finance Framework confirming alignment with the International
Capital Market Associations Sustainability Linked Bond Principles 2020.
• Russell McVeagh advised Spark on the issuance of the Sustainability-Linked
Bond.


About the SBTi
• The Science Based Targets initiative is a global partnership that provides a
clearly defined path to reduce emissions in line with the Paris Agreement goals.
The SBTi independently assesses and approves companies’ emissions reductions
targets in line with strict criteria.


Authorised by:
Alastair White
GM Capital Markets

Spark New Zealand Limited
ARBN 050 611 277 Spark City, 167 Victoria Street West, Private Bag 92028, Auckland, New Zealand



- ENDS –

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