Linklaters advises as Garanti Bank issues the first emerging markets gender bond

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Linklaters has advised Turkey’s Garanti Bank on its issue of $75 million of gender bonds, the first gender bond to be issued in the emerging markets. The gender bonds are focused on financing small enterprises and companies owned or managed by women in Turkey. The gender bonds were subscribed by the IFC, a member of the World Bank Group. The investment was made in partnership with the Women Entrepreneurs Opportunity Facility (WEOF), launched by IFC through its Banking on Women Program, and Goldman Sachs 10,000 Women.

All the financing raised though the bond issue will be earmarked for on-lending to Garanti Bank’s women-owned small business clients. The bond issue is expected to boost the number of the bank’s women-owned small business loans by up to three times over the next five years.

In Turkey, nearly 30% fewer women than men have access to individual financial services. Similarly, only about 9% of total small and medium sized businesses are owned by women and they face a credit gap of $5 billion, constraining business growth for these companies. The gender bond, a new financing structure in both the Turkish market as well as the international capital markets, will help create funding to support women entrepreneurs and business owners.

Richard O’Callaghan, Capital Markets partner at Linklaters, says:

“We’ve been at the forefront of the most interesting developments in the capital markets over many years, and these gender bonds really stand out as something that will have meaningful societal impact in the long-term. It’s an innovative financing tool which can easily be replicated in other markets.”

The Linklaters team advising Garanti Bank was led by capital markets partner Richard O’Callaghan and includes counsel Morag Russell and associate Sebastian Witte.