World Bank debuts €1.5bn SDG bond

BusinessGreen staff
clock
World Bank debuts €1.5bn SDG bond

Bank prices 10-year Global Sustainable Development Bond, confirming latest green bond issue was oversubscribed with around €2bn of orders

The green finance sector and efforts to deliver on the UN's Sustainable Development Goals (SDGs) received a further boost this week, as the World Bank announced plans for a new Global Sustainable Development Bond that is set to raise €1.5bn from institutional investors around the world.

The bond will be World Bank's first 10-year Euro-priced global bond in 10 years, and its first Euro global bond since August 2018 when it issued a 16-year €750m bond transaction.

Barclays, J.P. Morgan, Natixis, and TD Securities are the lead managers for the transaction. The bond is set to be listed on the Luxemburg Stock Exchange and an application will be made to list it on Euronext Dublin.

The World Bank said the global bond was oversubscribed, with an order book reaching €2bn thanks to orders from 69 investors.

The announcement of the bond coincided with the first in a series of workshops from the bank entitled "Catalyzing Global Savings to Advance Our Sustainability Goals", which was held in Dublin this week.

The event convened bond issuers, investors, and other key market participants to explore how to accelerate action on the UN's Sustainable Development Goals (SDGs) - the set of 17 wide-ranging development goals for 2030 that was agreed by the UN in 2015.

Paschal Donohoe TD, Ireland's Minister for Finance and Public Expenditure and Reform, said the country was pursuing "an ambitious strategy to help achieve the sustainable development goals, through the new development policy 'A Better World'".

"Working together with the development and financial community is a key part of our strategy," he added. "We welcome the World Bank's new sustainable development bond to raise awareness for SDGs that are aligned with our priority areas of prioritizing gender equality, reducing humanitarian need, climate action, and strengthening governance."

Jingdong Hua, World Bank Vice President and Treasurer, said the bond issue highlighted the significant market demand for SDG-focused bonds.

"This bond demonstrates strong interest and commitment of investors to support the Sustainable Development Goals through World Bank bonds," Hua said.

The bank is a major funder of SDG-related projects around the world, issuing $40bn to $50bn of bonds a year that are aligned with the sustainability bond guidelines published by the International Capital Markets Association (ICMA).

It stressed that the latest bond was part of a wider trend and would help support a number of specific SDGs.

"Increasingly, investors and other market participants are using the SDGs as a framework for investment and way to communicate support for specific development priorities," it said. "With this Sustainable Development Bond, the World Bank raises awareness for SDG#2 (Zero Hunger), SDG#5 (Gender Equality), SDG#13 (Climate Action), and SDG#16 (Peace, Justice and Strong Institutions).

"The bond offers its investors an attractive opportunity to align financial and social objectives."

More on Investment

Credit: iStock

'We must de-Putinise the world's economy': Government touts plans to accelerate green trade drive

International Trade Secretary Anne-Marie Trevelyan argues green trade has critical role to play in enhancing energy security and delivering on net zero goals

James Murray
clock 18 May 2022 • 4 min read
Climate Performance Potential is the unsung predictor of superior financial returns

Climate Performance Potential is the unsung predictor of superior financial returns

There is real money to be made from investing in companies with the greatest potential to reduce greenhouse gas emissions, argues World Fund’s Tim Schumacher

Tim Schumacher, World Fund
clock 18 May 2022 • 5 min read
Extreme heat emergency: More than a billion people facing heat risks without improved access to cooling

Extreme heat emergency: More than a billion people facing heat risks without improved access to cooling

New report suggests investment in suppotrt of the UN Sustainable Development Goals could protect 450 million people by 2030

clock 17 May 2022 • 3 min read