1. BofA Merrill Lynch announced this week that it would offer World Bank (WB) green bonds to its wealth management clients. The model is reminiscent of Nikko AM's World Bank Green Bond offerings for Japanese and EU retail buyers. By far the largest slice of retail interest in green bonds has been Japan, where we think total green-themed "Uridashi" outstanding will hit the $1 billion mark within the year. The ten year WB bonds sold through BofA ML will pay a 3.5 percent coupon for the first year that switches to a floating three-month USD-Libor based coupon after one year.
2. US House and Senate legislators have introduced a bill to create $3 billion of forest bonds to fund nonprofit conservation businesses to acquire forests for sustainable timber operations. It's got Republican and Democrat sponsors, so might get up.
