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How is the Green Bond market performing in 2018 so far?


We had a look at figures for Green Bond issuance for the first three quarters of 2018. This post goes over the most important and most interesting dynamics of the market in 2018 so far. We also attempt a year-on-year comparison for a more thorough analysis.  

  

Green Bond YTD issuance surpasses 2017 figures YoY  


Green Bond issuance has been holding up well in 2018 so far. Corporate, FIG and SSA issuers have borrowed close to USD95bn in Green bonds until end of September. This figure suggests a 2.5% compared to Q3 2017, when the amount reached USD92.4bn. The international Green bond market is thriving, with numbers reaching USD45bn, USD10bn up year on year. SSA issuers account for 45% of the total issuance, followed by Banks with 30% and Corporates with 23%. France, Belgium and USA are the largest Government Green borrowers, whilst Supranationals organizations raised USD11bn YTD.

Geographically, Green bond issuance remained diverse in 2018, coming from 36 different countries. Analysing the data by region, we see that issuance is coming mainly from Western Europe (53%) and then is split equally among North America, Asia and Supranational issuers.

Issuance currencies were correlated with the geographic picture, with 60% coming in the EUR currency and 23% in the USD one. Scandinavian issuers who are exceptionally eager in Green bonds pushed SEK issuance to almost USD4bn or 4%.

Sovereigns and Supranationals boost overall Green bond Issuance


SSA issuers account for USD42bn of the Green Bonds this year so far. 45 different issuers, coming from all around the world, but concentrated in Western Europe and driving these figures up.

At the end of February, Belgium launched its inaugural Green bond with 15 years of maturity and raised GBP4.5bn from the markets. The trade heavily attracted investors and as a result it was 3 times oversubscribed.

In late January, Poland tapped again the Green Bond market with a EUR1bn, 8.5-year ticket. According to Piotr Nowak, undersecretrary of state at Poland's finance ministry, the country intends to become the first SSA issuer to build a Green bond yield curve.

Additionally, on the 4th of September the World Bank, through IBRD, priced its first Sustainable Development Bond. In late August, the Supranational organization launched its new initiative for raising awareness for Water and Ocean Resources. The bond is denominated in SEK and has a maturity of 7 years. (find more details here).

"We are very pleased to price this SEK-denominated Sustainable Development Bond, so soon after we announced our new initiative. The demand for this bond shows that investors are aware of the critical need to protect water, our most precious resource, and to ensure a sustainable future. This demonstrates SEB’s continued leadership on sustainability, and is reminiscent of our partnership with SEB and Swedish investors 10 years ago, in issuing the first labeled green bond. We appreciate the increased interest in the Sustainable Development Goals and the World Bank’s work,” says Arunma Oteh, World Bank Vice President and Treasurer.

The European Investment Bank (EIB) raised EUR500m through its maiden Sustainability Awareness Bond (SAB). The SABs complement EIB’s Climate Awareness Bonds. By extending the same approach from climate to further areas of environmental and social sustainability. The proceeds of the bond will be used for water and marine resources protection, waste prevention, recycling and protection of healthy ecosystems.

  

Who is the largest Green Bond Dealer in the market?   

 

During October and November, CMDportal will survey market participants for their opinion on who is the Best Green Bond Dealer in the market. Get involved by submiting your credentials!

 

Find who won last year's Green Bond dealer Award in the CMDportal 2018 Awards on page 13: 2018 CMD Awards.

 

 

Check the latest League Table standing for the Green Bond market  

 

Green Bond Dealer                                                          01/01/18 - 30/09/18

Rank

Dealer

US$m

Market Share

1

Credit Agricole CIB

7,731

51

2

BNP Paribas

6,604

37

3

BoA Merrill Lynch

6,000

39

4

HSBC

5,016

43

5

Citigroup Global Markets

4,643

32

© CMD.

   

Where is this data coming from?  

 

CMDportal is the global bond and money market data utility connecting issuers, dealers and investors. The service aggregates data from a wide range of sources, including issuers, dealers and fund investors recording both who issued, who traded and who bought the instruments.

 

Can i produce a Debt Capital Market statistical query like this?  

 

Yes, you can. CMDportal provides a wide range of tools to analyse bond and money markets. Data Sheet results can be downloaded as an XLS file.

 

 



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