News

2018 is proving a banner year for green bonds in Hong Kong, with the launch of certification and subsidy initiatives, and a planned green bond programme by the government. Ahead of co-hosting with ICMA the 2018 G&SBP AGM and conference, Enoch Fung, Head of the Market Development Division of the HKMA, spoke to Sustainabonds about Hong Kong’s green bond hopes.

Obvion Mortgages priced its third green residential mortgage-backed securities (RMBS) issue flat to a post-crisis Dutch RMBS tight on 19 May, and its head of balance sheet management and funding cited its green nature as helping a EUR550m senior tranche achieve the tight pricing against a widening backdrop.

DNB Boligkreditt has established a green covered bond framework based on residential mortgages for the most energy efficient properties in Norway, after compatriot SpareBank 1 Boligkreditt tightened its criteria on the basis of feedback during its Climate Bonds Initiative certification process.

A coalition of 26 banks from around the world are developing Principles for Responsible Banking, which will seek to align the banking sector with the Paris Agreement and the UN Sustainable Development Goals (SDGs) and are expected to be launched for public consultation in November.

The European Commission unveiled its first legislative proposals aimed at gearing the EU financial system to tackle climate change yesterday (Thursday), including steps to establish a “groundbreaking” green taxonomy that could form the basis for an EU green bond label.

Banks assessing climate risks and opportunities in line with TCFD recommendations must look long term, make use of comprehensive scenario analyses, and adapt data collection, according to findings of a UN-convened pilot, which revealed positive impacts such as improved customer engagement.

Landshypotek Bank issued the first green covered bond from Sweden on Wednesday, a SEK5.25bn (EUR510m) five year issue that is the largest Swedish krona green bond to date and which achieved pricing at a sizeable “greenium”, exceeding the issuer’s expectations.

Europe’s “active and engaged” market is at the forefront of global green bond developments, with its financial institutions playing a crucial role in green financial infrastructure, according to a Climate Bonds Initiative analysis.