Mar 25 , 2021

Nexyz.Zero Green Finance

World's First LED Securitization Earns Moody's Highest Aaa (sf) Rating

First-Ever R&I-Rated Securitized Green Loan in Japan

Nexyz.Group Corporation (Tokyo; Takami Kondo, president and CEO; TSE First Section: 4346) today announced that the Nexyz.Zero Green Finance service of consolidated subsidiary Nexyz.Zero Corporation (Tokyo; Takuma Yoshida, president) became the first securitized LED finance mechanism in the world to receive an Aaa (sf) rating from Moody's SF Japan K.K. Nexyz.Zero Green Finance securitizes lease receivables, mainly for LED lighting, which reduced energy consumption and contributes to the global environment. Further, Nexyz.Group today announced that Nexyz.Zero Green Finance also became the first securitized LED finance mechanism in Japan to receive a securitized Green Loan Evaluation (Second Opinion) from Rating and Investment Information, Inc. (R&I).

Nexyz.Zero Green Finance

Overview

The Nexys.Zero Series provides the latest commercial equipment to businesses at zero initial investment. The service has been adopted by more than 68,000 customers in Japan, including retail shops and facilities across various industries and local governments (administrative agencies). Nexyz.Group has been working with megabanks to secure a projected investment budget of 50 billion yen for customer installations.

Nexyz.Zero became the first company in the world to receive the highest rating of Aaa (sf) by Moody's SF Japan for the securitization of lease receivables, mainly for LED lighting. LED lighting contributes to the global environment by reducing energy consumption. Nexyz.Group believes the low cancellation risk of loans originated by Nexyz.Zero, as well as the company's debt collection and management capabilities, were factors behind this high rating. Under conventional securitization mechanisms with financial institutions, Nexyz.Zero would bear the entire repurchase obligation. The current securitization mechanism, however, provides reduced repurchase risk, even in the event of natural disaster or other unforeseen circumstances, with the repurchase obligation representing the subordinated portion of approximately 27.5%. The result is lower contingent liabilities and an improved financial position for Nexyz.Zero.

The Securitized Green Loan Evaluation by R&I, a first for Japan, likely reflects the October 2020 Nexyz.Group certification as an ECO FIRST Company by the Minister of the Environment, which recognized the company's contribution to the global environment in reducing CO2 emissions, etc. In addition, Nexyz.Group contributes to the wider adoption of commercial refrigerator-freezers and air-conditioning systems that use environmentally friendly refrigerant gases such as R32, rather than R22, which has a harmful effect on the global environment.

Between December 2012 and October 2019, Nexyz.Group reduced CO2 emissions by a cumulative 658,000 tons on the way to a targeted cumulative reduction of 1.5 million tons by the year 2025. Funding through Nexyz.Zero Green Finance has been recognized as an important part in reaching this goal.
These circumstances have made it possible for Nexyz.Group to raise funds not only within Japan, but also from overseas, maximizing the creditworthiness of the Nexyz.Zero business dramatically and creating a securitization mechanism that will allow for global expansion of the Nexyz.Zero business model. At the same time, attention to green projects has been growing on a worldwide basis, driven by the corporate pursuit of ESG-oriented management and contribution to the SDGs. Nexyz.Group will continue to communicate its commitment to environmental investment to a wide range of stakeholders and its contribution to the global environment.

Comments from Takami Kondo, Nexyz.Group Corporation President and CEO

The environment surrounding our society is going through rapid, disruptive change. These changes include global climate change, unstable world conditions, the speed of technological advancement, and ultra-short business cycles. All companies must change in anticipation of risk and respond to change by procuring what they need, quickly when they need it.

In 2012, we launched Nexyz.Zero as a new service to completely eliminate the expensive up-front costs of installing LED lighting. As of today [February 28, 2021], 68,241 customers in Japan have used Nexyz.Zero, from restaurants to SMEs to local governments. While banks and other financial institutions have various advantages to protect customer deposits, regular businesses such as ours are not in a position to expect public financial support. For this very reason, we have been proactive in taking on the risk ourselves, developing our own sophisticated risk management functions. We are creating a shift in mindset from ownership to use. As this model changes, securing the highest rating of Aaa (sf) from Moody's SF Japan will serve as a powerful foothold in developing businesses in new areas. Nexyz.Zero provides a means for businesses that are always looking for the next step forward, and we intend to continue expanding Nexyz.Zero as a new option for financing.

Reference

●About Moody's
One of the world's oldest credit rating agencies, Moody's was founded in 1900. The company provides ratings not only in the U.S., but also in Europe, Japan, and Australia, holding a 40% share of the global credit rating market.
Click here for the Moody's press release (Japanese)

●About the R&I Green Loan Evaluation (Second Opinion)
R&I provides a second opinion to assess whether a green finance framework established by a company complies with the Green Bond Principles (GBP), etc. A framework is a set of policies established by the procuring entity prior to entering into green financing. The framework outlines the use of procured funds, the project evaluation and selection process, the management of procured funds, and reporting.
Click here for the R&I press release (Japanese)

●Nexyz.Group Press Release (October 21, 2020)
Nexyz.Group Corporation Certified as an ECO FIRST Company by the Ministry of the Environment

●Nexyz.Zero Series Service Lineup (Partial List)

Nexyz.Zero Series Service Lineup (Partial List)
  • (1)LED Lighting
  • (2)Air Conditioning
  • (3)Hand Dryers [Jet Towels]
  • (4)Bathroom Facilities
  • (5)Sanitizers/ Area Sterilizers/ Deodorizers
  • (6)Water-Conservation Devices
  • (7)Security Cameras
  • (8)Cubicles
  • (9)Payment Terminals
  • (10)Smoking Booths/ Smoke Separation Equipment
  • (11)Steam Convection Ovens
  • (12)Deep Fryers [Dr.Fry2]
  • (13)Refrigeration Equipment
  • (14)Dishwashers
  • (15)Remodeling/ Renovations

Inquiries

Nexyz.Group Corporation
Public Relations Kosuke Taki

TEL:+81-3-6415-1178  FAX:+81-3-5459-4435  
URL:https://www.nexyzgroup.jp/en/inquiry/

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