Specifically, the Security Token was directly registered by SG-FORGE on the Ethereum public blockchain. The issuance, totalling EUR 10 million, took the form of a senior preferred unsecured bond with a 3-year maturity. The digital format of this green bond marks a step in the right direction for Societe Generale in harnessing blockchain's capabilities, offering improved transparency, traceability, and better efficiency in transactions and settlements.
The security tokens were fully subscribed through a private placement by two prominent institutional investors, AXA Investment Managers, and Generali Investments. The funds raised through this issuance, exclusively amounting to the net proceeds of the bond will be dedicated to financing or refinancing Eligible Green Activities, as per the criteria outlined in Societe Generale's Sustainable and Positive Impact Bond framework.
The group has been a consistent issuer of Positive Impact Bonds since its inaugural issuance in 2015. This transaction also introduces blockchain as a tool for data repository and certification, aimed at fostering transparency in Environmental, Social, and Governance (ESG) and impact data on a global scale.
Noteworthy innovations include continuous open access availability of information regarding the carbon footprint associated with the digital bond infrastructure directly within the bond's smart contract. This allows issuers and investors to measure the carbon emissions linked to their securities.
According to Societe Generale, its foray into blockchain-based Green Bonds aims to underline its commitment to innovation in digital instruments and its responsiveness to the growing demand for digital assets, particularly those with ESG considerations. Additionally, the issuance introduces a new option for investors to settle securities on-chain through the EUR CoinVertible, a digital asset issued by SG-FORGE in April 2023. This complements traditional cash settlement solutions and demonstrates the diverse capabilities of SG-FORGE in providing a full spectrum of on-chain services.
In April 2021, Societe Generale-FORGE, a subsidiary of Societe Generale Group, has introduced CoinVertible, which is a digital asset denominated in Euros on the Ethereum public blockchain. Operating as a licensed investment firm under the supervision of the Prudential Supervision and Resolution Authority, Societe Generale–FORGE aimed to facilitate connectivity between traditional capital markets and the digital assets ecosystem.
Leveraging the CAST1 open-source interoperability and securitisation framework, the launch of CoinVertible preceded forthcoming European regulatory changes, including 'MiCAR 2' and 'Pilot Regime.' The initiative addressed clients' requirements for a stable settlement asset in on-chain transactions, supporting intra-day liquidity needs, and providing on-chain liquidity funding and financing solutions. Additionally, the stablecoin presented itself as a potential solution for corporate treasury, cash management, and cash pooling activities.
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