New York, Nov 16 : Global issuance of green, social and sustainability bonds – or sustainable bonds, collectively – totalled a record $127.3 billion in the third quarter of 2020, a 30 per cent increase over the previous high set last quarter, Moody’s Investors Service said on Monday in a report.
“Global sustainable finance volumes will approach $425 billion in 2020 after a strong third quarter,” said Matthew Kuchtyak, AVP-Analyst in Moody’s Investors Service’s ESG Group.
“We now forecast around $250 billion of green bonds, $100 billion of social bonds and $75 billion of sustainability bonds for the full year.”
Sustainable bonds accounted for a 6.1 per cent share of global debt issuance in the third quarter, which is also a new quarterly record.
Sustainable bond issuance amounted to $288.2 billion through the first nine months of the year, 24 per cent higher than the same period of 2019.
Green bond issuance jumped 31 per cent from the second quarter to $72.3 billion globally in the third quarter as economic conditions somewhat improved. Green debt types are evolving, with green capital instruments and green sukuk emerging as areas to watch, added Kuchtyak.
Record issuance of both social and sustainability bonds for the second consecutive quarter, at $28.1 billion and $26.9 billion respectively, also drove the the overall sustainable bond issuance record. While issuers continued to primarily use these labelled bonds to finance their coronavirus pandemic response efforts, a growing number of companies employed such instruments to showcase their broader sustainability goals, suggesting continued growth of sustainable bonds beyond the pandemic.
Sovereign sustainable bond issuance in particular continues to grow as countries respond to investor demand and raise capital for sustainable development activities, said Moody’s. Following several debut issuances in the third quarter, sovereign sustainable volumes stand at $33.1 billion year-to- date, up from $21.8 billion for all of 2019.
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