Three weeks after adopting a new energy policy that axes coal lending, the World Bank is back with a new $550m, 2 year Green Bond, AAA. The bond coupon is 0.375%, slightly better than US Treasury bonds. (Rates sure a low, aren't they!)
According to Investment & Pensions Europe, the bond was placed with 17 investors: 44% were asset managers; 35% pension funds and insurance companies; and 2% corporates[2]. 61% of them were US investors; 38% were European, and 1% was Japanese. Strong interest was seen once again from asset managers which is potentially indicative of institutional mandates making their way through to managers.
Environmental Finance reports that buyers included Swedish funds AP2 and AP3, Blackrock, Deutsche Asset and Wealth Management, Everence, Nikko Asset Management, SEB Wealth, State Street Global Advisors (SSgA), TIAA-CREF, Trillium Asset Management and two Climate Bond Standard board members, the California State Treasurer's Office and the California State Teachers' Retirement System (CalSTRS). It's the third time that the California State Treasurer Bill Lockyer has bought World Bank Green Bonds, with the order on this bond being the lead order for the transaction ($100m).
Joint-lead managers were green bond pioneers SEB (good to see more issuance under the guiding hand of Christopher Flensborg) and Morgan Stanley.
The World Bank has issued almost sixty green bonds since 2008, with an estimated total value of over $4bn. Proceeds go to tackling climate change issues that directly impact developing countries. More of it, we say!
