By Ioannis Gougoulias
The data below were retrieved using CMDportal's Data Sheet and Instrument Search tool.
After a slow Q1, International Green Bond markets are back in full swing.
Green bond issuance in 2018 has been running at a slower pace than last year, but overall is holding up well. Last year Corporates, FIGs and Sovereigns issued close to USD41bn until May 17, while this year we calculate USD40bn. The reduced pace is primarily in domestic markets. International green bond issuance is up year on year. Whilst last year we calculated USD12.5bn until May 17, this year that number is close to USD20bn. In particular issuers from France, Germany and the Netherlands were more active. German issuers increased by 40% whilst Dutch issuers did so by around a third.
Sovereigns boost overall Green Bond market issuance
Sovereign SSAs have issued more than USD21bn in Green Bonds this year so far. They make up just over half of the market and completed a number of significant deals.
Indonesia joined France, Poland, Nigeria and Fiji, and was the first Asian country to sell a Green Sukuk Bonds in the USD international bond market. (Read more on this transaction here)
Also recently, Belgium issued its first sovereign green bond worth EUR 4.5 billion to finance environmental and clean energy initiatives.Final Books reached a staggering level of EUR12.7bn+. The Bookrunners were Barclays, BNP Paribas Fortis, Credit Agricole CIB, ING and JP Morgan. Belgium are now the third European Sovereign to have undertaken a Green offering. (Here are the trade details)
Poland won the race to become the first Sovereign Green Issuer in late 2016 with a modest EUR750m 5-year deal. This year, Poland raised EUR1bn making it the first nation to return to the market for environmentally friendly finance. Piotr Nowak, undersecretary of state at Poland's finance ministry, expressed the country's intention to become the first sovereign to build a green bond curve, raising finance for environmental projects at a range of maturities. Confidence in Polish credit in general and the green nature of the bond made it popular with investors and as a result it attracted more than EUR3.4bn of order books. (Trade details here)
Lithuania issued the first Sovereign Green Bond in the Baltics, which is now listed on the Nasdaq Baltic Debt Securities list. The proceeds of the bonds will be used to implement green projects, i.e. the modernizations of multi-apartment buildings and increase of energy efficiency.
"We are pleased to present Lithuanian investors with green bonds issued by the Government. Thus we are increasing the opportunities for Lithuanian capital market participants to contribute to the financing of green projects. Interest in green bonds is growing rapidly worldwide; it’s a global process. I am happy that we are also moving in this progressive direction and developing a green bond market in the country," Vilius Šapoka, the Minister of Finance, said. (Trade press releases here)
Corporates Green bond issuance share grows to 27%
Corporate borrowers YTD pick up 27% of the market, being the only asset class that saw a percentage increase YoY. Enel Finance issued at the beginning of the year a EUR1.25bn Green bond, which was almost 3 times oversubscribed. The bond is listed on the Irish Stock Exchange and on the Luxembourg Stock Exchange. The proceeds of the bond will be used for the development and the construction of renewables generation plants and construction and operation of transmission and distribution networks. (read more here)
Additionally, in early March 2018, Fonciere INEA issued the largest EUR Green Private Placement Bond. The size of the bond is EUR100m and was arranged by LCL. Philippe Rosio, President of Foncière INEA, commented: "This significant transaction will enable us to finance a pipeline of previously identified new office acquisitions in the regions with specific CSR commitments. This new resource is competitive (fixed annual rate of 3.00% at 6 years and 3.25% at 7 years), secure and of long maturity. We are sensitive to the trust thus shown by leading investors in Foncière INEA's strategy and development.". (read more here)
Prologis and Growthpoint Properties have also tapped the market with two EUR300m and USD94m in 3 tranches, respectively. To get more insight on the trades click on the links: Prologis Inaugural Green Bond, Growthpoint Green Bond.
Where is this data coming from?
CMDportal is the global bond and money market 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 Markets 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.
Mr. Gougoulias is an Analyst at CMDportal. He can be reached at email@example.com.