Green

Hamburger Sparkasse issued the first green euro benchmark covered bond of 2026 yesterday (Tuesday), a €500m seven year debut Green Pfandbrief that benefited from its scarcity and ESG credentials to achieve a strong result in terms of demand and price, according to Haspa’s Felix Zillmann.

Adaptation and artificial intelligence are among key themes being flagged for sustainable investing in 2026, as the industry responds to climate, geopolitical and technological developments, with expectations for green, social and sustainable bond issuance modest.

The State of Hesse on Tuesday printed the largest green bond from a European region, a €1.5bn 10 year that attracted over €6bn of orders and more accounts than on any previous Hessian issue, with the level of demand and greenium of at least 1bp seen as testament to its credentials and efforts.

Berlin Hyp issued the post-summer reopening euro benchmark covered bond for a fifth consecutive year on Wednesday, and Bodo Winkler, head of funding and investor relations at the issuer, told Sustainabonds that interest in social bonds now appears to be almost on a par with green.

The European Commission could expand the European Banking Authority’s mandates for follow-up work on the EU covered bond directive to include recommendations on green covered bonds, which were a key topic for the European Central Bank at a recent Helsinki European Covered Bond Council plenary.

Caffil sold the first bond from a new and enlarged group green, social and sustainability framework on Tuesday, a €750m five year green transaction that benefited from the scarcity of both its maturity and ESG nature, according to SFIL’s Gonzague Veillas.

ECB officials called for greater disclosure of all covered bonds’ climate-related risks at a European Covered Bond Council plenary last week, while speakers were sympathetic towards a flexible definition of green covered bonds as the EBA asked the industry whether it feels the asset class requires a dedicated framework.

The European Covered Bond Council is working on a definition of green covered bonds aimed at reflecting the distinct characteristics of the instrument to ensure its appropriate treatment in incoming regulations, and following a Green Bond Principles update deemed contradictory to its core feature by some.