The European Bank for Reconstruction and Development (EBRD) has successfully priced its largest green bond transaction to date, raising USD 1 billion. This landmark issuance, set to settle on 17th July 2024, marks EBRD’s significant return to the EUR market after a three-year hiatus.
The bond, which features a 2.875% annual coupon and matures on 17th July 2031, was priced at 99.856%, with a re-offer yield of 2.898%. The spreads were set at +12 basis points over mid-swaps and +47.5 basis points over the benchmark. The green bond will be listed on both the London Stock Exchange’s Regulated Market and the Luxembourg Green Exchange (LGX).
Proceeds from this issuance will support EBRD’s Environmental Sustainability Programme, specifically targeting a diverse portfolio of green projects. These projects include investments in energy efficiency, renewable energy, water management, waste management, and pollution prevention and control, as well as sustainable transport.
The bond issuance comes in the wake of a positive market environment, buoyed by the resolution of recent volatility stemming from the snap French elections. The mandate for this new 7-year green transaction was announced on Tuesday, 9th July, and saw strong investor interest from the outset. The order book opened the following morning, with initial guidance at MS+15bps, and quickly surpassed EUR 2.6 billion in orders within a few hours. By the time the order book closed, final orders had exceeded EUR 2.7 billion, allowing the size to be set at EUR 1 billion.
This new issue attracted substantial demand from high-quality green bond investors, underscoring the market’s robust appetite for sustainable investments. The transaction was jointly led by BNP Paribas, Credit Agricole CIB, and NatWest Markets.
EBRD President Odile Renaud-Basso commented on the issuance: “We are very pleased with the strong investor response to our largest ever green bond. This transaction supports our commitment to environmental sustainability and demonstrates the growing importance of green finance in addressing climate change and promoting sustainable development.”
The EBRD continues to lead as an institutional investor in Serbia, with over €9 billion invested across 355 projects. The focus remains on enhancing private-sector competitiveness, facilitating green energy transitions, and developing sustainable infrastructure, all while contributing to the economic resilience and long-term prosperity of the regions it serves.
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