Public sector issuers are at the forefront of green and social bond markets as they seek to support society in transitioning, justly, to a sustainable future. Demand is buoyant, supported by regulatory developments, but challenges remain, notably in determining appropriate standards on the social side. Sustainabonds gathered leading players to tackle the key issues facing the sector in a roundtable discussion finalised in mid-February.
Loans to local government bodies large and small are behind SFIL’s green bond issuance, and the French group anticipates complementing this with social lending, according to CEO Philippe Mills and colleagues.
Issuers lacking projects appropriate to use-of-proceeds green bonds but with clear sustainability targets and transition strategies are increasingly finding sustainability-linked bonds (SLBs) a viable alternative for reflecting their ESG ambitions in the capital markets. In this special report, sponsored by ABN AMRO, Sustainabonds’ Neil Day explores the surge in issuance and finds out what issuers need to be doing to win over investors.
Nederlandse Gasunie in October launched the first sustainability-linked bond (SLB) from the European gas transmission sector, a €300m 15 year deal with methane and Scope 1 and 2 emissions reduction targets. Here, Gea Paas Broekman and Loek Caris at Gasunie, and Dick Ligthart and Ton Roeten at sustainability structuring advisor ABN AMRO, discuss how the instrument furthers the Dutch company’s sustainability objectives and transition into an energy infrastructure company.
A year on from SpareBank 1 Østlandet’s green bond debut, Karoline Bakka Hjertø, head of sustainability, and Runar Hauge, portfolio manager, treasury, spoke to Sustainabonds’ Neil Day about how the bank is furthering its ESG ambitions. Eivind Hegelstad, CFO and investor relations, SpareBank 1 Boligkreditt — the SpareBank 1 banks’ joint covered bond-issuing specialist entity — joined the pair to share insights into green mortgages and the related funding strategy.
Korea’s Hana Bank aims to build on its sustainable issuance in a variety of formats and currencies to reach KRW 25 trillion (€18.6bn) by 2030. Yoo-Na Ha, senior manager of ESG planning section, Hana Bank, spoke to Sustainabonds’ Neil Day about how green and social bonds reflect the group’s evolving sustainability targets and wider developments in Korean society.
A €500m seven year covered bond last month was the latest addition to social bond issuance inaugurated by Yorkshire Building Society (YBS) in May under the first such framework for a UK builder. Duncan Asker, director of treasury, and Richard Driver, head of financial structuring, at YBS told Sustainabonds’ Neil Day how the issuance carries the financial institutions’ “real help with real life” mantra into its funding.
The World Bank has hit new heights in bond issuance since the start of the pandemic, as investors have supported IBRD and IDA in the task of alleviating Covid-19’s social and economic damage. Heike Reichelt, head of investor relations and sustainable finance, World Bank Treasury, spoke to Sustainabonds’ Neil Day about how its issuance is connecting investors with impact.
The first sustainability-linked bond (SLB) from a bank suggests the instrument can be a viable and attractive option for financial institutions committed to reaching climate-related and other targets. However, questions remain over its regulatory treatment, while data could pose challenges.
The European Investment Bank (EIB) has helped shape sustainable bond issuance from its first Climate Awareness Bond (CAB) in 2007 to the recent arrival of the Taxonomy. Head of sustainability funding Aldo Romani and sustainability funding officer Johannes Heidbrink discussed the philosophy behind the supranational’s strategy and the latest market developments with Sustainabonds’ Neil Day.