The first Green Bond issued in Asia easily raised $500 million, and since a third of investors are local, that’s a good sign for future bonds.
The 10-year bond from Asian Development Bank has a 2.2% coupon, and proceeds will fund renewable energy (solar, wind, geothermal, small hydro), energy efficiency, sustainable transport (rail and/or bus), and climate adaptation projects.
Funded projects will be listed on the Bank’s website, in addition to annual newsletters that keep investors up to date on how the proceeds are being used.
With plans to finance more than $3 billion in climate-related projects, this is the first of many Green Bonds from that bank.
About 44 investors participated including large insurance companies like Nippon Life, banks like Morgan Stanley, and fund managers like Blackrock and Calvert Investments.
"The relative value, targeted use of proceeds and strong commitment to ongoing project reporting made ADB’s inaugural Green Bond issue an attractive investment opportunity," says Stephen Liberatore, Managing Director/Portfolio Manager at TIAA-CREF Asset Management, a pension fund investor.
In 2014, Green Bonds reached a record $36.6 billion, more than triple the previous year ($11 billion), and many expect the market to hit $100 billion this year.
Vestas Issues a Green Bond
In another first, Vestas is the first pure green corporation to issue a Green Bond.
The 7-year, EUR500 million bond has a 2.75 coupon and will be used for general corporate purposes for Vestas, the world’s top wind turbine manufacturer.
Read our article, The Green Bond Rush Continues.
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