How do you like them apples! Cupertino commits to largest ever US corporate green bond – a huge $1.5bn! And gets both a second review & post issuance assurance – now that's leadership.

Apple dropped into the green bond market for the first time yesterday with a whopping $1.5bn issuance. The green bond was part of larger $12bn bond sale by Apple, which is the second largest bond market deal so far this year.

This inaugural green bond has a 7-year tenor, semi-annual coupon of 2.85% and is rated Aa1 by Moodys.  Lead underwriters for the deal are Goldman Sachs, Bank of America Merrill Lynch, Deutsche Bank and JP Morgan.

Proceeds will be used to ‘Reduce Impact on Climate Change’ (yes yes yes!) by financing green buildings, energy efficiency, renewable energy, energy infrastructure, water efficiency, recycling and pollution reduction.

 

Green credentials supported by pre and post issuance reviews, indicates a shift change for the US green bond

In a boost for the corporate green bond market Apple has followed the pre and post issuance review model (in line with the Climate Bonds Standard) by committing to a second review from Sustainalytics prior to issuance and post issuance assurance from an audit firm. 

We are yet to see the full documentation on the Apple green bond so look out for more details in our next Green Bond Market Report blog.

This positive signal to future US corporate issuers not only about green bonds but also that getting an independent review on the green credentials is a fairly standard process.

There is a lot of potential for the US corporate green bond market and we expected it kick off in 2015, clearly it didn’t get the momentum last year but with Apple leading the way this year we may see a ramping up of the market.

Brilliant work Apple!

 

Green Bond Market: Strong Start to 2016

So far this year (2016) Climate Bonds Initiative calculates that $11.9bn has been issued in green bonds, not even including the ground breaking $500m Climate Bonds Certified US Municipal green bond issued earlier this week by the New York MTA1.

 

1 Deals are included in figures when priced. MTA remains open at time of publish 17/02/2016.

Disclaimer: The information contained in this market report does not constitute investment advice and the Climate Bonds Initiative is not an investment adviser. Links to external websites are for information purposes only. The Climate Bonds Initiative is not advising on the merits or otherwise of any bond or investment. A decision to invest in anything is solely yours. The Climate Bonds Initiative accepts no liability of any kind for investments any individual or organization makes, nor for investments made by third parties on behalf of an individual or organization.