Market
Financial Times, Green Bonds need global standards, Chris Floods
FT about risks associated with lack of mandatory global standards for green bonds: uncertainty for investors, minor concerns about greenwash and potential - slowing down the growth of the market.
Green bonds can be issued currently under a variety of voluntary standards. But no monitoring mechanism exists to ensure compliance with either the Green Bonds Principles or Climate Bonds Standards, the two main frameworks. China has also developed its own separate green bonds standards. Critics say this fragmentation creates uncertainty for investors and will slow the growth of the market in future.
Financial Times, Sellers of green bond face a buyer’s test of their credentials, Kate Allen
FT highlights there is no general consensus on whether it is the issuer itself that needs to be green, or just the project that the bond is financing. The author uses Poland’s and Repsol’s green bonds as examples.
Yet there is no universal certification system, something Standard & Poor’s suggests is holding the sector back as the bonds “do not fully qualify as mainstream investment vehicles”.
Investment Europe, Awakening Green Giant, Ilia Chelomianski
The author focuses on issues surrounding the green bonds market such as: lack of liquidity and common standards - and suggests ways of solving them.
The market’s limited liquidity poses a similar challenge. Although it’s not a problem in the Sovereigns, Supranationals and Agencies (SSA) sub-sector, it does matter in the corporate market, where investors tend to buy and hold the longer-dated issues.
Global Capital, The green bond market needs innovation to make a difference, Lewis McLellan
The author claims the green bonds market needs to also attract borrowers further down the credit spectrum.
The absence of lower rated borrowers in green bonds does not stem from lack of buyers. Investors say growth in demand for green assets offering more generous yield is outstripping supply.
Reuters, Nigeria to issue first green bond in next few weeks – officials, Sophie Hares
We might soon see the first emerging market green bond.
Nigeria plans to launch its delayed "green" bond - the first for an emerging market country - within a few weeks, the country's former environment minister said.
MarketWatch, Green bonds in Africa could be one way out for a zero-yield world, David Marsh
The new frontier for Africa may be the issuance of green bonds to finance environmentally friendly development projects including infrastructure, under a range of initiatives by governments, banks and international development agencies.
Environmental Finance, Trump, standardisation and aggregation are obstacles to green bonds - Fitch
The lack of comprehensive standards for green investments and mechanisms for aggregating small projects, as well as the retreat form climate change regulation under the Trump administration are the main hurdles to the growth of the green bond market, according to a report by Fitch.
Local markets coverage
ITALY, MEXICO, BRAZIL
Economia & Finanza, Climate bond: ecco come conciliare le performance con l’impatto ambientale (Italian media)
El Economista, Nuevo NAICM, entre principales emisores verdes (Mexican)
Exame.com, Títulos verdes do Brasil devem ter venda recorde em 2017, Vanessa Dezem e Gerson Freitas Jr. (Brazilian)
Brasilagro, Títulos verdes do Brasil devem ter venda recorde em 2017 (Brazilian)
CHINA
Financial Times, China leads world on green bonds but the benefits are hazy, Lucy Hornby
FT asks whether green bonds issued in China are less „green” than its Western counterparts.
“This is one of many measures the central government has approved to shift the super tanker to green,” says Sean Kidney, chief executive of the Climate Bonds Initiative, which works closely with the People’s Bank of China to develop green bonds. “They are ‘zero to hero’, as we like to say, in one year.”
Shanghai Daily, Color of money: what’s green, what’s not?, Leng Cheng
The issue of standards in a Chinese context.
About a third of China’s green bond issues, or US$12.6 billion, doesn’t fit the global definition of green, according to the Climate Bond Initiative and the China Central Depository & Clearing Co.
South China Morning Post, London calling: green finance, belt and road the latest China business push, Enoch Yiu
Read on to find out more about London-Beijing green finance collaboration.
(…) Britain and mainland China have already been talking closely about setting up joint international standards and studies on how best to manage green projects.
Gulf News, China matches its green intentions with the details, Helen Wong
A captivating summary of China’s record in greening its economy.
China is ploughing billions into clean energy, promoting the use of electric vehicles, investing in low-emissions infrastructure for its fast-growing cities, and widening the options for green financing.
PV Magazine, China key to growth of green bonds market in 2016, Brian Publicover
The author refers to a recent Fitch’s report evaluating the green bonds market and stressing the role of Chinese issuers.
Chinese financial institutions were responsible for the six biggest green bond deals in 2016 through the first quarter of 2017, led by Shanghai Pudong Development Bank, with a $3.04 billion offering, according to Fitch data.
Investment Executive, Asia drives green bond market’s growing diversity: Fitch, James Langton
Another referral to the Fitch’s report.
Fitch also notes that new issue activity in China and India is helping diversify the market.
Repsol Green Bond
The first-ever green bond from an oil company. Our in-depth analysis here.
Bloomberg Quint, First Green Bonds Sold by an Oil Giant Find Willing Investors, Emily Chasan
The Spanish refiner Repsol SA on Tuesday is due to complete the issue of a five-year 500 million-euro ($559 million) green bond.
Reuters Africa, Repsol greases the wheels of Green bond market, Laura Benitez
The company is raising the funds to upgrade its renewable energy functions, such as furnaces and turbines, in a bid to reduce its emissions.
The Washington Post, First Green Bonds Sold by an Oil Giant Find Willing Investors, Emily Chasan
“This is fundamentally dubious,” said Sean Kidney, the founder of the Climate Bonds Initiative, the London-based organization that drafts green-bond standards. “At the moment, we’re unlikely to include this in our listings of green bonds and our data for green bond indexes.”
Global Capital, Respol oils way for green bond first, Michael Turner
Spain’s Repsol brought the first ever green bond from an oil major to the market on Tuesday, leaving the green investors to pick through the morals of financing a sector that environmentally responsible finance was created to help mitigate.
OilPrice.com, Repsol Completes Massive Issue Of “Green Bonds, Zainab Calcuttawala
Repsol says the money earned from the issue will not be used for the exploration or extraction of oil or natural gas. To ensure compliance to this goal, the company plans to hire external auditors who will review corporate finances from time to time.
Guia Gas & Oil Brazil, Repsol é a primeira grande petrolífera a vender obrigações verdes (Brazilian media coverage)
Enikonomia.gr, FT: Χαμένο στη... μετάφραση το Ελντοράντο των «πράσινων ομολόγων» (Greek media coverage)
New joiners to our Partners' Programme
Institutional Asset Manager, S&P Global joins Climate Bonds Initiative Partners Programme
This decision means that all of the company’s divisions including S&P Global Ratings, S&P Global Market Intelligence and S&P Global Platts are now represented in the programme.
Guru Focus, S&P Global Joins Climate Bonds Initiative Partners Program
"We are excited to enhance our partnership with the Climate Bonds Initiative to advance the green bond market by bringing a deeper level of insight, data and analysis to sustainable investing," said Courtney Geduldig, Executive Vice President, Public Affairs, S&P Global.
Energy Live News, German stock exchange joins green finance scheme
Deutsche Börse announced it has become part of the Climate Bonds Initiative Partners Programme, where it will develop climate finance solutions, participate in market development committees and help define policy agendas for national, regional and sector based schemes.
IFC invests in Poland’s first commercial green bond
Bank Zachodni WBK of the Santander Group is the first Polish commercial bank to issue green bonds.
Reuters, World Bank's IFC invests 137 million euros in Bank Zachodni's green bonds
IFC, a member of the World Bank Group, will invest 137 million euros ($153.3 million) in subordinated green bonds issued by Poland's Bank Zachodni WBK to help it to finance climate-related projects, IFC said in a statement.
Renewables Now, IFC invests EUR 137m in Polish green bonds
Late last year, Poland became the first ever sovereign to issue a green bond, with a EUR-750-million bond financing a range of climate-related projects, the Climate Bonds Initiative (CBI) said at the time. BZ WBK’s green bond issuance is the first one by a local commercial bank since then, IFC noted.
Clean Technology Business Review, IFC collaborates with Bank Zachodni WBK to support green finance in Poland
With IFC’s support, BZ WBK will be able to significantly expand its existing climate portfolio in renewable energy, green buildings, and climate-smart equipment, among others.
Ends
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