Stock exchanges play a crucial role as an intermediary between investors and issuers, but their role in the sustainable finance market – as platform and infrastructure providers, as facilitators of cross-market standards development, and as educators bringing visibility to new asset classes – is so much wider than that. We speak with Robert Scharfe, CEO of the Luxembourg Stock Exchange, a leader in sustainable finance with over half of the world’s green bonds listed on its exchange, on how to attract more investors and borrowers to the market.
MUFG has a wealth of expertise in energy and natural resource infrastructure finance, which lends itself quite nicely to understanding how to measure risk in areas ripe for green bonds and similar instruments, and the bank is of course very active in bringing borrowers into the green bond market. We speak with Geraint Thomas, Executive Director at MUFG and leader of the bank’s green capital markets activity to learn more about how EM issuers and investors are finding their way in the green bond market, and the development of new sustainable finance instruments.
South Africa’s Myriad International Holdings tapped the international markets – Eskom signed loan agreement with China Development Bank – Private sector activity in South Africa fell in June – Nigeria sells T-Bills worth NGN31.9bn – Nigeria’s government intervenes to avert the collapse of Etisalat Nigeria – Kenya delays plans for maiden sukuk – Chad attempts to delay loan repayment – Gabon gets downgraded
City Developments Limited (CDL), the Singapore-listed real estate giant with a global presence spanning 97 locations in 26 countries, has been praised for its sustainability efforts, which place it top among Singapore corporates in the Global 100 Most Sustainable Corporations in the World 2017 rankings. We speak to the company’s Chief Sustainability Officer Esther An about challenges associated with issuing green instruments in the region and CDL’s strategy going forward.
The state-owned company, which finances and promotes power sector projects in India, successfully launched its inaugural green bond, becoming the first Indian public sector corporate to issue USD-denominated “green” debt and supporting the central government’s sustainability drive.
Saudi Arabia-based ACWA Power placed a US$814mn bond with a 22-year maturity in the international markets in May, an impressive debut following a year of planning and structuring. The transaction allowed the company so diversify its investor base and extend its maturity profile.
UAE-based lender National Bank of Abu Dhabi (NBAD) broke new ground by becoming the first MENA issuer to tap the green finance markets with a debut US$587mn 5-year green bond. The deal marked the largest size and tightest spread for an FI green issuance across the emerging market space, excluding China.
Global green bond issuance is estimated to top US$206bn in 2017, according to figures from Moody’s, but the development of the asset class in emerging markets is still being hampered by lack of incentives, standards and awareness, according to sustainable finance professionals.
TSKB set a new precedent in the Turkish capital markets in 2016 when it became the country’s first financial institution to issue a green bond. Now, with more stringent environmental regulations on the horizon, the bank is seizing on new deal opportunities and vying to become Turkey’s leading sustainable finance practitioner. We speak with Çiğdem İçel, Executive Vice President at TSKB about the bank’s inaugural green bond and the pipeline for sustainable projects in 2017.
The rapid growth of green finance has sparked interest from many audiences. The use of bonds to finance green projects have become an exciting market development, with demand from investors consistently outstripping supply. Across the globe, borrowers and investors are keen to engage in sustainable financing opportunities and we have seen increasing activities in Asia, paving the way for the markets in the Middle East to take off.
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