EBRD Issues EUR 1 billion 7-year Green Bond
Listing: London Stock Exchange's Regulated Market & Luxembourg Green Exchange (LGX)
The proceeds are earmarked to support a specific portfolio of green projects (the “Green Project Portfolio” or “GPP”), which currently comprises investments in the following 5 areas:
- Pollution Prevention and Control / Sustainable Transport.
On Wednesday 10th July 2024, the European Bank for Reconstruction and Development (EBRD, Aaa/AAA/AAA) priced its largest ever green bond transaction, a EUR 1 billion 7-year benchmark. The new issue marks EBRD’s return to the EUR market after a three-year absence. It follows from EBRD’s USD 1 billion 10-year and USD 2.5 billion 5-year transactions from earlier this year.
The EUR 1 billion 7-year green bond priced at MS+12bps, with a reoffer price of 99.856% and pays an annual coupon of 2.875%. This gives a re-offer yield of 2.898%, equivalent to a spread of +47.5bps above the current DBR 0% 02/15/2031.
The green bond was issued off EBRD’s Environmental Sustainability Programme, where proceeds are earmarked to support a specific portfolio of green projects (the “Green Project Portfolio” or “GPP”), which currently comprises investments included in the following 5 areas: Energy Efficiency, Renewable Energy, Water Management, Waste Management, Pollution Prevention and Control/Sustainable Transport.
Encouraged by a positive market backdrop recovering from recent volatility on the back of snap French elections, the mandate for a new EUR 7-year green transaction was announced on Tuesday 9th July at 10:05 UKT. Following strong interest, the orderbook officially opened the next morning at 07:58 UKT with guidance at MS+15bps area.
Interest from investors grew rapidly throughout the morning surpassing EUR 2.6 billion by 10:13 UKT, enabling the spread to be set at MS+12bps. The orderbook closed at 10:30 UKT with final orders in excess of EUR 2.7 billion and the size set to EUR 1 billion with demand from over 70 investors.
The transaction attracted impressive demand from high quality green bond investors.
The new issue was joint-lead managed by BNP Paribas, Credit Agricole CIB and NatWest Markets
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