HMB Social Bond Framework

1. Introduction

The Home Mortgage Bank (HMB) is a specialized non-bank financial institution in Trinidad and Tobago. HMB’s core businesses include the origination of Mortgage-Backed Investment Securities and Commercial and Corporate Credit.

HMB is headquartered in Port of Spain, Trinidad and Tobago, and was enacted through legislation by the Parliament of the Republic of Trinidad and Tobago by way of the Home Mortgage Bank Act, Chapter 79:08. Its mandate is to: (i) develop a mortgage market and maintain a secondary mortgage market in Trinidad and Tobago; (ii) contribute to the mobilization of long-term savings for investment in housing; (iii) support the development of a system of real property and housing finance; and (iv) promote the growth of the domestic capital market.

The projects financed using the resources provided by the bond issuance will be aligned with HMB’s institutional strategy, with the United Nations Sustainable Development Goals (SDG), and with the Social Bonds Principles (SBP) and its four key pillars: (i) use of proceeds; (ii) process for project evaluation and selection; (iii) management of proceeds; and (iv) reporting.

2. Goals and applicable principles

On issuance of its first Social Bond1, HMB will be delivering on its mandate to develop and maintain a secondary mortgage market in Trinidad and Tobago. This allows local originators to increase their funding to first-time homeowners classified as low-and-middle income earners.

The Social Bond Principles 2 (“SBP”), published by the principles’ secretariat The International Capital Markets Association (ICMA), are voluntary guidelines that recommend transparency and disclosure. They promote integrity in the development of the Social Bond market by clarifying the approach for issuance of these Bonds. The SBPs are intended for broad use by the market: they provide issuers with guidance on the key components involved in launching a credible social bond; they aid investors by ensuring the availability of information necessary to evaluate the social impacts of their Social Bond investments; and they assist underwriters by moving the market towards expected disclosures that will facilitate transactions.

Home Mortgage Bank will issue its first Social Bond in alignment with the SBP.