London – 26 September 2014 – BNP Paribas today announced that together with the World Bank (International Bank for Reconstruction and Development, IBRD, rated Aaa/AAA), it has launched the second equity-index linked green bond this year – for a European pension fund.
The EUR10 million 12-year structured World Bank Green Bond is linked to the performance of the Ethical Europe Equity Index, an index that selects eligible sustainable companies for inclusion based on analysis by Vigeo and Forum Ethibel. The index is managed by Solactive.
This transaction is very similar to the inaugural green equity linked transaction BNP Paribas and World Bank launched earlier this year.
World Bank Green Bonds raise funds for projects seeking to mitigate climate change or help affected people adapt to it. Examples of the types of projects supported by World Bank Green Bonds include renewable energy installations, energy efficiency projects, and new technologies in waste management and agriculture that reduce greenhouse gas emissions and help finance the transition to a low carbon economy. They also include financing for forest and watershed management and infrastructure to prevent climate-related flood damage and build climate resilience.
Since its inaugural green bond in 2008, the World Bank has now raised more than USD 6.7 billion equivalent through 72 green bonds in 17 currencies.
Stephanie Sfakianos, Head of Sustainable Capital Markets, Fixed Income, at BNP Paribas said: “With volumes in the green bond market expected to top over $20 billion in 2014, issuers are seeing green bonds as a way of both broadening their investor base and attracting socially responsible investors. We are committed to continuing to deliver innovative and market leading solutions for clients in this important and rapidly growing market.”
Renaud Meary, Global Head of Structured Equity, BNP Paribas said: “This second transaction comes as green investments have cemented their place in capital markets. Investors are increasingly incorporating ethical considerations into their investment choices, leading to growing interest in sustainable products. With combined expertise in equity derivatives, fixed income, and sustainable investments BNP Paribas is well placed to help investors achieve those aims.”