Published: February 1, 2017
Red goes Green
Poland’s US$750mn green bond is world’s first.
Poland stepped through the door and became the first sovereign to issue a green bond. On December 20, Poland’s state treasury issued a €750mn, 5-year note, with a coupon of 0.5% under the country’s €60bn euro medium term note programme.
Vikram Puppala, associate director, research products at Sustainalytics told EMEA Finance, “this transaction has definitely set expectation for the continent. It is a great development, and we can expect to see many more such issuances. France has already indicated it will be launching a green bond, and they are one of the biggest credit issuers in the world. So, one can expect this to have a very significant impact on the development of the global market.”
Indeed, Poland’s successful funding has already acted as a catalyst, and France’s Agence France Trésor announced on January 23 the creation of its Green OAT, which will have a maturity date of June 25, 2039. The agency reports that the green bond will finance expenditure identified as promoting energy and ecological transition. At the time of going to press, the size and coupon for the bond were not yet finalized, although there were market reports that the bond would likely close in the neighbourhood of US$2.5bn. Barclays, BNP Paribas, Crédit Agricole CIB, Morgan Stanley, Natixis and SG CIB were appointed joint lead managers. Crédit Agricole CIB is in charge of structuring the Green OAT.