As a conduit for Covid-19 economic mitigation measures, KfW is at the heart of Germany’s fight against the impact of the coronavirus. New treasurer Tim Armbruster and head of IR Jürgen Köstner spoke to Sustainabonds’ Neil Day about the practical and market challenges it faces in its latest role, and its overall sustainability ambitions.
The broader sustainability strategies of green and social bond issuers and the impact of their issuance across a range of metrics are increasingly being focused on. Meanwhile, new varieties of sustainable bonds could yield benefits, but complicate the picture. Sustainabonds gathered leading public sector issuers and ESG-focused investors for a roundtable, hosted by SFIL, to discuss key developments.
November saw the inauguration of the SFIL green bond framework, with a covered bond from Caffil, as well as one of the sustainable projects it is helping finance. The group’s Philippe Mills and Sami Gotrane explain how green and social bond issuance reflect its public policy goals.
Overall ESG strategies are as important to investors as the specifics of green bonds, as they seek to avoid green-washing and encourage brown issuers to make the transition to sustainability.
Asset growth, EU sustainable finance initiatives and pricing benefits could all help green bond supply rise to meet the growing demands of investors, according to speakers at an LBBW conference on 1 March, where a broadening of issuance, particularly into social bonds, was called for.
The development of the Social Bond Principles and a focus on the Sustainable Development Goals are among catalysts helping the social bond market grow in the slipstream of green bonds. Pioneering and future issuers and others shared their experiences and expectations with Sustainabonds for this timely roundtable.
Recent inaugural green senior non-preferred issues could represent the first green steps down the capital stack by financial institutions. Crédit Agricole CIB and our sister publication Bank+Insurance Hybrid Capital gathered together specialists in bank capital and green bonds to explore how green subordinated debt could work and help put the financial system on a path to sustainability.
Issuers wishing to win over investors with SRI mandates not only need to deliver green and social bonds, but must demonstrate how these fit into a broader sustainability strategy for the future — that was the key takeaway from a Sustainabonds roundtable hosted by SFIL in Paris on 24 May, where the market’s growth, EU initiatives, and pricing were debated.
Ahead of 150th birthday celebrations on 8 May marked by a gift of saplings to its home city, Berlin Hyp tightened its pioneering green bond framework and revealed an increasing positive environmental impact from the programme.
Green bonds backed by mortgages might seem a natural source of supply from banks. However, a lack of joined-up data is forcing banks to be creative in carving out pools of energy efficient loans. Neil Day explores the building blocks for a bigger market with ABN AMRO’s Joop Hessels.