EIB Issued World’s First Green Bond 10 Years Ago
Ten years after issuing the world’s first green bonds, the European Investment Bank, today highlighted the unique contribution of green bonds to accelerating private sector funding for climate related investment. Speaking at gathering of institutional investors, asset managers and financial institutions hosted by Commerzbank in Berlin, to mark the tenth anniversary of EIB’s issuance of the world’s first green bonds, the EIB’s Vice President responsible for climate and the environment confirmed commitment to support capital market support for climate investment in the years ahead.
Since pioneering green bonds the EIB, the world’s largest international public bank and the largest issuer of green bonds, has continued to support initiatives to increase investment in climate related projects and strengthen investor confidence in green bonds.
The EIB also confirmed a new partnership with NGO We Forest to reverse deforestation and combat desertification where forests are most threatened. Under the initiative a new tree will be planted by We Forest in Africa, Asia or the Amazon for every signature on the dedicated EIB website and for every Euro donated by global banks supporting green bonds. The initiative would enable both private and institutional support for green bonds to tackle deforestation in vulnerable communities.
Commerzbank supported the EIB’s first issuance of green bonds in the debt capital markets ten years ago and earlier this week Commerzbank acted as a joint-lead manager on a new €1bn Climate Awareness Bond from the EIB. Yesterday’s transaction had an ultra-long tenor of 30 years, making it the longest outstanding Green Bond issue in the market.
“On the occasion of the 10 year anniversary of the first Climate Awareness Bond, EIB once again set a new Milestone transaction with the longest tenor ever. Even at the ultra-long end of the curve, EIB demonstrated its market leadership and attracted strong investor demand. The EIB is not only the first but also the largest issuer in the Green Bond and we are very proud of our long-standing partnership with EIB in the sustainable bond market and beyond.” said Mirko Gerhold, head of DCM Bonds Solutions at Commerzbank.
“Green bonds play an increasingly important part in accelerating support for climate related investment. Over the last decade the fight against climate change has been strengthened through the contribution of debt capital markets to fund climate solutions. We are pleased to mark the historic green bond anniversary together with Commerzbank and other German partners, and look forward to unlocking private support for climate related investment in the years ahead.” highlighted Jonathan Taylor, European Investment Bank Vice President.
The first green bonds were issued by the European Investment Bank, the Bank of the European Union, ten years ago on 4th July, 2007. Since then the EIB has issued more than €19bn of Climate Awareness Bonds in 11 different currencies. The EIB’s Climate Awareness Bonds have financed investment in 146 renewable energy and energy efficiency projects in 44 countries around the world.
The self-financing EIB is the world’s largest supranational bond issuer and issues green bonds, which finance a significant proportion of renewable energy and energy efficiency lending, alongside regular bonds.
The EIB is the world’s largest multilateral financier of climate related investment and last year alone provided €19 bn for climate action projects worldwide. In support of the Paris Agreement, EIB committed to deliver climate finance globally for around €100bn in the five year period to 2020.
Source: Press release
The order book was the largest for a sovereign green transaction.
RBC Capital Markets paid more than $800,000 to resolve charges that it engaged in unfair dealing in munis.
Electronification of the municipal bond market also presents a large opportunity.
The success of Northbound trading showed electronic execution is way forward for the bond market.
Investors will be able to better assess the economic stability and creditworthiness of issuers.