GREEN BONDS
GLOBAL STATE
OF THE MARKET
2019
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RECORD$259BNISSUEDIN 2019
T R A NS P O R T

Prepared by Climate Bonds Initiative.

LDING

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Overall global green bond market

Contents• USD754bn cumulative issuance(since inception in 2007)• 5,931 deals

3 Geographic Market Overview• 927 issuers• USA leading with USD171.5bn, followed by China(USD107.3bn) and France (USD86.7bn)• Certified Climate Bonds reach USD100bn milestone

5 Regions and Countries

2019 global green bond market

13 External Reviews

4 2019 GB Market in Numbers
5 2019 GB Market Overview• USD258.9bn 2019 issuance (2018: USD171.2bn)• 1,802 deals (2018: 1,591)• 506 issuers (2018: 347)
• 291 new issuers: (2018: 204)
• 8 new countries (Russia, Saudi Arabia, Ukraine, Ecuador,
Greece, Kenya, Panama, Barbados)• USA top with USD51.3bn, followed by China (USD31.3bn)
and France (USD30.1bn)

Outlook for 2020 – 2021
• Green bond growth expected from financial institutions,sovereigns, Certified Climate Bonds, and climatealigned issuers• Greater use of other labels (e.g. sustainability andsocial bonds), especially in light of COVID-19, as well as
performance-linked instruments (e.g. KPI-linked credit
facilities) to facilitate transition• Increased focus on transitioning “brown” sectors,
such as aviation, steel, and cement• Harmonisation of taxonomies (esp. EU Taxonomy),green bond guidelines and disclosure

Understanding green bonds

Green definitions

Green bonds

The Climate Bonds Green Bonds Databaseand market analysis is based on the
Climate Bonds Taxonomy categories:
Energy, Buildings, Transport, Water,
Waste, Land use, Industry, and ICT.5
Certified Climate Bonds

Green bonds are issued to raise finance forclimate change solutions - the key is forthe proceeds to go to green assets. They
can be printed by various issuer types,
such as governments and governmentbacked entities, financial institutions,and non-financial corporates. The
green label can be applied to any debt
format, including private placements,
securitisations, covered bonds, and sukuk,
as well as green loans which comply with
the Green Bond Principles (GBP) or theGreen Loan Principles (GLP).3,4

CBI also develops Sector Criteria withexpert input from the international science
community and industry professionals.6
Issuers can certify their green debt
instruments under the Climate Bonds
Standard and these Sector Criteria.7
Independent Approved Verifiers provide
a third-party assessment that the use ofGreen Bonds Global State of the Market 2019 Climate Bonds Initiative

7 Issuer Types and Use of Proceeds
10 Currency
11 Deal Size, Tenors and Bond Types

15 Appendix: Volume by Currency

About this report
This is the Climate Bonds Initiative’s Green
Bonds Global State of the Market 2019. It
focuses on the 2019 green bond market,
uncovering trends in issuance and identifying
avenues for market growth. The analysis isbased on our Green Bonds Database.1
The figures are as of the end of 2019, andhave slightly increased since our 2019 Green
Bond Market Summary (from February) due
to additional bonds being included.2
In September we will publish an interim Stateof the Market for 2020, including analysis of
the wider labelled debt universe.

About the Climate Bonds
Initiative
The Climate Bonds Initiative (CBI) is aninternational investor-focused not-forprofit organisation working to mobilise the
USD100tn bond market for climate changesolutions. Our mission is to help drive down
the cost of capital for large-scale climate
and green infrastructure projects, including
supporting governments seeking increased
capital markets investments to meetclimate goals.

proceeds complies with the objective of
capping global warming at 2°C.
Inclusion in CBI’s Green Bonds Database
Only bonds with at least 95% ofproceeds dedicated to green assets
and projects that are aligned with the
Climate Bonds Taxonomy are included
in our Green Bond Database and figures.
If there is insufficient information on
allocations, a bond may be excluded.
The full version of the CBI Green Bond
Database Methodology is available on
CBI’s website.8 However, we are currently
working on a revised methodology, to be
published in the coming months.

2

Geographic Market Overview
USD259bn of green bonds in 2019
Netherlands
Luxembourg
Belgium
Iceland

NorwaySwedenFinland
RussiaDenmark
IrelandGermany
UK
PolandUkraineFranceAustria
Portugal
Greece
China
Spain
Italy
Switzerland
Saudi Arabia
India
Costa Rica
UAE
Barbados
Colombia
Nigeria
ThailandKenya
BrazilMalaysia

CanadaUSA
MexicoPanamaEcuador
USD30bn +JapanSouth Korea
TaiwanHong Kong
Philippines
Indonesia

Singapore

USD10-30bn

Peru

USD5-10bn

Chile

USD1-5bn
USD0-1bn

Australia

South Africa

New ZealandSupranational

No issuance

O
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USD Billions (Cumulative)

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Ca
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60

US
A

USD Billions (2019)

Top 2019 countries: Amount issued (2019 vs. Cumulative)

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Number of issuers (Cumulative)

60

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120

UK

60

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Au
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180

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240

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120

US
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Number of issuers (2019)

Top 2019 countries: Number of issuers (2019 vs. Cumulative)

Note: Country reflects the country of risk, which is different to the issuer’s domicile if its parent is from another country. FM = Fannie Mae.
Green Bonds Global State of the Market 2019 Climate Bonds Initiative3

2019 Green Bond Market in Numbers

Overall market

Top 5 issuers• USD258.9bn issued (+51% vs. 2018)

1. Fannie Mae, USA (USD22.8bn, +13%)• 506 issuers (+46%)• 1,802 deals (+13%)

2. KfW, Germany (USD9.0bn, +375%)
3. Dutch State Treasury (USD6.7bn, debut)• 811 deals excluding Fannie Mae (+65%)

4. Republic of France (USD6.6bn tap, +9%)

• New countries: Russia, Saudi Arabia, Ukraine,
Ecuador, Greece, Kenya, Panama, Barbados

5. ICBC, China (USD5.9bn, +154%)

Top 5 countries (amount issued)
1. USA (USD51.3bn, +44%)
2. China (USD31.3bn, +1%)
3. France (USD30.1bn, +113%)
4. Germany (USD18.7bn, +144%)
5. Netherlands (USD15.1bn, +105%)

Top 5 most frequent issuers
1. Fannie Mae, USA (991 deals, -10%)
2. Vasakronan, Sweden (29, +93%)
3. IFC, Supranational (16, +78%)
4. SNCF, France (12, no deals in 2018)
5. ADB, Supranational (11, +57%)

Top 5 countries (number of issuers)
1. USA (105 issuers, +59%)
2. China (79, +14%)
3. Japan (47, +88%)
4. Sweden (40, +43%)
5. France (19, +58%)

Deal size• 10% of deals benchmark-sized (USD500m+),
21% excluding FM (2018: 6%, 20%)
• Average deal size USD144m,
USD291m excl. FM (2018: USD108m, USD308m)• Median deal size USD31m,
USD119m excl. FM (2018: USD21m, USD122m)

Deal currency• 83% of deals in hard currency,
63% excl. FM (2018: 87%, 59%)
• 83% of amount issued in hard currency,
81% excl. FM (2018: 80%, 77%)
• Issuance in 34 currencies (2018: 31), including
four new: DKK, CZK, KES, BBD

External reviews• 92% of deals received an external review,
81% excl. FM (2017: 95%, 83%)
• 86% of volume received an external review,
85% excl. FM (2017: 89%, 88%)
• CBI Certification: 17% of volume(2018: 14%)

Green Bonds Global State of the Market 2019 Climate Bonds Initiative4

2019 Green Bond Market Overview
Top 3 sustainable financetrends in 20198 new countries and 291
new issuers

215 repeat issuers: 66%
of 2019 volume

1. Mainstreaming of green finance infinancial system, regulatory and investor
responses to climate change contribute toannual green debt exceeding USD200 then
USD250bn for the first time.

Issuance from eight new countries emergedin 2019 – Barbados, Ecuador, Greece, Kenya,
Panama, Russia, Saudi Arabia, Ukraine – witha combined issuance of USD3.1bn. This takes
the total number of countries with green
bonds issued to 62 (excl. Supranational).12

USD171bn was issued by 215 repeat issuers (i.e.
that had issued before 2019). This volume was
evenly distributed across issuer types. Financial
corporates (19%) and non-financial corporates(18%) remained top but were closely followed
by government-backed entities (17%), ABS(15%) and development banks (14%). Repeat
sovereign issuance contributed 9%, largely asa result of France tapping its French Green OAT
three times for a total of EUR5.9bn; however,
Belgium stood out as the most frequent
sovereign issuer, with six taps (EUR2.4bn).

2. The continued rise of a broader range of
SDG-related debt labels (e.g. sustainability
bonds, social bonds) and ESG-linked credit.
In parallel, an increasing debate on how
to enable transition in various key sectors,
including with ESG-linked instruments andthe emergence of the ‘transition’ debt label.
3. Further work on market harmonizationand standardization:• The EU continued developing a taxonomy
of sustainable activities, proposed creating
an EU Green Bond
Standard, and in
December announced
the EU Green Deal.9

Meanwhile, 291 debut green bond issuers (i.e.
had not issued before 2019) accounted for
USD88bn of issuance, or 34% of the global
2019 market. 37% of debut issuer volume wasattributed to non-financial corporates and
25% to financial corporates. Sovereigns andloans followed, respectively with 11% and 9%.
The largest debut issuer was the Dutch State
Treasury Agency, issuing the Netherlands’ firstgreen sovereign, a Climate Bonds Certified
transaction to the value of USD6.7bn.
40 of the 291 debut issuers,
accounting for USD17bn involume, came to market morethan once in 2019. The largest
in this group was the Republicof Chile with two deals totalling
USD2.4bn, one in USD andthe other in EUR – the firstsovereign from Latin America
has already returned to market
with multiple deals in 2020.
LG Chem and Citigroup wererespectively the second andthird largest.

• Launch of Climate Bonds
Standard V3.0, withimproved definitions,guidance, and alignment
with upcoming EU Green
Bond Standard. Climate
Resilience Principles
published as precursor
to Climate Resilience
Criteria.10,11

Further, 132 entities issued multiple deals
in 2019 (i.e. repeat within the year), mostly
previous issuers but also several market
debuts as mentioned above. 21 entities
issued five or more deals during the year,
contributing 28% of the total volume.
Frequency(# of deals
in 2019)

Numberofissuers

Share oftotal 2019
volume

2

79

15.8%

3

18

8.4%

4

14

4.1%

5-9

16

15.4%

10 or more

5

12.3%

132

56.0%

Regions and Countries
All regions increase volume

Issuance by region: Europe drives 2019 growth

2019 was the first year since 2016 in which
all regions (including Supranational)
increased volumes. Not only this, but thechanges were considerable everywhere. The
same is true looking at issuers and deals if
Fannie Mae is excluded (slight dip in North
America’s deal count otherwise).

This extends Europe’s regional lead in
cumulative volumes to over USD100bn morethan North America and Asia-Pacific, which
are respectively in second and third place.

Supranational
200

EuropeNorth America

150

Asia-Pacific
Latin America

100

USD Billions

Europe experienced the largest increase, withan added USD50bn vs. 2018 representing 57%
of the global expansion. All European issuer
types, apart from loans and ABS, reached theirhighest level yet, with non-financial corporates,
government-backed entities and developmentbanks standing out as particularly strong (resp.
2x, 2.5x and 5x increase).

250

Africa

50

0
2015

2016

2017

2018

2019

Note: Latin America includes Mexico.

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

5

For the first time ever, 2019 saw Asia-Pacificachieve the second-highest regional volume
in consecutive years (previously 2018 and2016), with corporates accounting for almost
60% of this. Even so, APAC’s 29% increase
was smaller than North America’s 46%, so
the difference between the two regions was
smaller in 2019 than 2018. By number ofissuers, APAC is comfortably the regional
leader, having added another 126 issuers during
2019 (half of the total new issuer count). Japan
was a key contributor to this, adding 22 issuers.
Elsewhere, Latin America and Africa both had
their best years yet, respectively rising threefold to USD4.7bn and six-fold to USD898m (vs.
2018). Latin America’s increase was driven by
the Republic of Chile issuing the first sovereigndeals from the region as well as continued
strength from non-financial corporates (3xincrease), while more than half of Africa’s
volume stemmed from Redstone Solar’s
ZAR8bn (USD567m) Certified green loan.

Supranationals
Supranational entities also reached arecord figure – USD13.8bn, 9% higher
than in 2018 – despite there being no newissuers. As well as this, however, multilateraldevelopment banks (MDBs) have remained
important supporters of emerging market(EM) issuance by investing in and helping tostructure debut green bond deals.
In addition to the usual support provided bylarge MDBs, such as the World Bank, IFC andEIB, smaller regional development banks havealso stepped up their involvement. In Latin
America, for example, the Inter-American
Development Bank (IDB) has subscribed,

Cumulative green bond issuance by region
RegionGreen bondmarkets

Issuers

Amount issued(USDbn)Change 2018-19(amount)

Europe

25

269

307.4

74% +

North America

2

167

190.4

46% +

Asia-Pacific

18

345

183.6

29% +

Supranational

-

11

79.4

9% +

Latin America

11

47

12.9

216% +

Africa6162.7495% +

in whole or in part, to multiple deals – e.g.
Ecuador’s first, by Banco Pichincha – while
also helping new issuers come to market,
most notably the Republic of Chile with its
inaugural sovereign green bond programme.
The IDB is also developing a Green Bond
Transparency Platform for Latin American
green bonds. It will be publicly available(open access) and feature disclosure of all
documents and information pertaining to thegreen bonds.
In Asia, the Asian Development Bank
(ADB) is a frequent issuer of green bonds(USD2.4bn from 11 deals in 2019) andincreasingly provides support to issuers. For
example, after fully subscribing to B.Grimm
Power’s Certified deal in December 2018,
including funding the Certification itself, in
2019 the bank invested in another deal bya Thai issuer: AC Energy. The ADB is also
helping to develop the market in other ways,
for instance launching an Action Plan for
Healthy Oceans in early 2019 through which

Top 10 issuer domiciles 2019
Country

Issuers

Deals

Amount issued(USDbn)2018-19 change(amount)

1

USA

105

1,128

51.3

44% +

2

China

79

99

31.3

1% +

3

France

19

54

30.1

113% +

4

Germany

12

25

18.7

144% +

5

Netherlands

15

17

15.1

105% +

6

Sweden

40

106

10.3

66% +

7

Japan

47

66

7.2

73% +

8

Canada

14

17

7.0

63% +

9

Italy

10

11

6.8

128% +

10 Spain

11

17

6.5

3% +

Top 10 total

352

1,540

184.3

49% +

Top 10 %

69.6%

85.5%

71.2%

-0.9% -

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

it will expand investments and technicalassistance for the blue economy by USD5bn
between 2019-2024.
Overall, the share of developed markets(DM) grew from 69% in 2018 to 72% in2019, with that of EM falling slightly from
24% to 23%. Supranationals experienced thelargest drop, from 7% to 5%.

France, Germany &Netherlands prominent
Among the top 10 issuer domiciles, thetop three remained the same in 2019: USA,
China, and France.
The USA’s increase was substantial, rising
USD15.8bn, or 44%, with Fannie Mae (FM)included. Excluding FM, the USA experienced
an even larger expansion of 85%, taking thevolume to USD28.5bn (from 137 deals).
France, however, saw the largest increaseof any country, more than doubling inamount issued to USD30.1bn (USD14.1bn in2018), only USD1.2bn below that of China.
Supported by policy, France has the widest
pool of large issuers by some margin, with
the Republic of France (USD6.6bn), SNCF
(USD4.3bn), Engie (USD3.8bn), Société duGrand Paris (USD3.6bn) and Crédit Agricole(USD2.6bn) all contributing more than USD2bn.
Other European countries also saw large
jumps in volume. In Germany, issuancerose 144% to USD18.7bn, while in the
Netherlands a 105% increase took it to
USD15.1bn. Like France, both Germany
and the Netherlands feature large issuers;
the top two in each country – KfW and
LBBW, and the Dutch State Treasury andTenneT Holdings – make up around 60%of respective volumes. Overall, European
markets tend to have the largest issuers.
Sweden and Canada remained in the top
10 but ranked higher, while Japan and Italy
were new entrants and Spain dropped to10th place. However, all of these managed toincrease volumes in 2019.

6

Issuer Types and Use of Proceeds
Non-financial corporates top issuer type for first time, rising 101%

Sovereign green bondissuers to date

250

Debut

Belgium

Mar 2018 8.2bn

EUR

Chile

Jun 2019

2.4bn

USD/
EUR

Fiji

Nov 2017

49m

FJD

FranceJan 2017

23.3bnEUR

Hong Kong

May 2019

1.0bn

USD

Indonesia

Mar 2018 2.0bn

USD

IrelandOct 2018

5.7bn

EUR

Lithuania

May 2018

24m

EUR

Netherlands May 2019 6.7bn

EUR

200

150

USD Billions

100

50

0
2015

2016

2017

2018

2019

Total Issue
issued currency
USD

Country

Sovereign

Loan

Development Bank

Nigeria

Dec 2017

71m

NGN

Non-Financial Corporate

Government-Backed Entity

ABS

PolandDec 2016

4.3bn

EUR

Local Government

Financial Corporate

Seychelles

Oct 2018

15m

USD

Non-financial corporates
fuel growthLike with regions, all issuer types
experienced volume increases in 2019. The
same is true by number of issuers and deals,
apart from a small drop in ABS deal countdue to less prolific issuance by FM.
Within private sector issuance, nonfinancial corporates performed particularly
well, topping the issuer type ranking forthe first time. Their issuance more thandoubled to USD59.1bn, overtaking financial
corporates which only increased 12%, theleast of all issuer types. This is a “reversal”
of 2018, which saw financial corporates
more than double in volume while nonfinancials stagnated.13

With nine issuers (eight in 2018), three of whichwere debuts, sovereigns increased another
USD7bn (same gain as 2018) to reach almost
USD25bn. The Dutch State Treasury Agency, adebut, ranked top with USD6.7bn, ahead of the
Republic of France with USD6.6bn. The Kingdomof Belgium was third with USD2.7bn, its six
deals being the only ones out of the country.

Energy, Buildings and Transport
extend leadAll use of proceeds (UoP) categories hadvolumes increase in 2019, most of them by

While allocations rose across the board,
the top 3 categories – Energy, Buildings
and Transport – were the strongest
performers, accounting for USD80bn of
the overall USD88bn added. Buildings saw
the largest absolute year-on-year increase(+USD30.1bn), closing the gap with Energy,
while Transport was highest in relative
terms with +71%. At 82%, their combined
share reached the highest level since 2015(77% in 2018).

Top 3 Use of Proceeds categories account for over 80% of 2019 issuanceGreen loans were the second-largest movers
in 2019, posting 98% growth. A total of 39
green loans were recorded during the year,
the largest being a USD2.7bn Certified deal
by debut Noor Energy 1 to finance a 950MW
solar plant in Dubai.
Public sector issuance also rose robustly,with all issuer types apart from local
governments reaching record volumes.
Most of the increase was driven by
government-backed entities – mostly
European – and development banks, withboth almost doubling in size. The latter
was primarily due to strong issuance fromnational development banks such as KfW(over MDBs).

a substantial amount – this contrasts with
2018, when they were mostly flat.14

Transport
20%
Water
9%
Buildings
30%

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

Waste 3%

Waste 3%

Land use 3%

Energy32%

Unallocated A&R 1%
ICT 1%
Industry 1%

7

Energy, Buildings and Transport increase their share of UoP in 201915
80
2019
2018
2017
60

Comparing the growth in volume with thegrowth in number of deals and issuers yields
some interesting differences.

20

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Finally, ICT allocations increased sharply in2019 (22x versus 2018), albeit from a very
low base. This was due to large debut deals
by Telefónica (EUR1bn), Verizon (USD1bn)
and Vodafone (EUR750m) to financeincreases in network energy efficiency aswell as investments in renewable energy andgreen buildings.

40

USD Billions

In Waste, the number of deals rose
36%, while that of issuers only 10% - i.e.
compared to 2018, the average amountallocated per deal fell while the amount per
issuer increased. By contrast, in Land use theissuer count was up by 46% and deal countby 43%, suggesting lower average amounts
for both. The drop in amount allocated per
deal can be caused by a) smaller deals, and/or b) the share of Waste / Land use in eachdeal falling.

Bu

Water, Waste and Land use experienced
more moderate growth. Water (+18%),
which almost doubled in 2017 but was flatin 2018, has cemented itself as the fourthlargest category. Waste (+17%) and Landuse (+17%) continued the steady rise of thelast few years but have yet to reach USD10bn
in annual volume.

Blue economy: enhanced barriers prevent scale
While funding for sustainable marine
projects has risen in the last few years, it isstill dwarfed by most other project types in fact, several studies indicate that “SDG
14: Life below water” receives the least
investment globally out of all the SDGs.16

According to the Climate Bonds Green
Bond Database, as of the end of 2019
there were 50 deals from 32 issuers
financing blue projects, most of them
related to offshore wind and/or also
various types of projects on land.

Green bonds financing blue projects: dominated by marine
renewables (i.e. offshore wind)

Number of deals / issuers

15

2019

Total

With environmental protection already apublic good, the added challenge in thesustainable financing and managementof marine activities is that these usuallylack well-defined property rights andtheir impacts are difficult to attribute to agiven cause (unlike land-based activities,
where ownership and impacts are typicallyeasier to define). An initiative to protect
one marine area, for example, is likely toincrease fish populations elsewhere.
This amplifies the barriers to scaling up
financing for blue projects and enhances
the need for public sector issuance as well
as modern governance structures that
address problems with a holistic, circularand ecosystems-based approach.

10

5

0
Deals

Issuers

Marine RE

Deals Issuers

Deals Issuers

Deals Issuers

Marine RE +Land

Marine non-RE

Marine non-RE+ LandNote: Marine RE = marine renewable energy; Marine non-RE = any other marine projects(e.g. fishing, conservation); + Land = bond also financed other (non-marine) projects.

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

Definition: the term ‘blue economy’refers to the sustainable use of ocean
resources for development, including
activities such as fishing, tourism, offshore
energy, biotechnology, marine conservationand others. Its usage has increased withthe widespread degradation of marine
ecosystems, which poses enormousthreats to ocean and human health.

8

Which projects are financed byeach issuer type?
A relationship between UoP categories andissuer types is to be expected, by the simple
fact that some types of projects are more
likely to be financed, and often implemented,
by some issuer types over others. For
example, in many countries, waste / water
management services are provided by public
sector entities such as municipalities orgovernment-backed entities.
Indeed, the UoP profile of each issuer typeseems to support this.
Private sector issuance – especially fromnon-financial corporates and loans, which
are almost always obtained by corporates –tends to finance Energy and Buildings. Likely
reasons for this are that such assets are not
only relatively ‘easy’ to finance with a greenlabel – because the projects are more clearlygreen and the benefits easier to measure andverify – but they are also:
a. typically owned by private sector
companies; andb. more often present economic gains
from green investments, e.g. due toincreasingly lower costs of production(Energy) or long-term resource savings(Buildings).
By contrast, public sector issuers, suchas local governments and governmentbacked entities, fund a relatively high shareof Transport, Water and Waste projects(sovereigns too but with a higher share ofLand use). Apart from sovereigns, the mosteven UoP distribution is among financial
institutions, i.e. financial corporates anddevelopment banks. This makes sense giventhat they typically allocate proceeds to manysmaller projects and companies, and thus
often list many eligible UoP categories.
The same is broadly true pre-2019. However,most issuer types exhibit a more even split
in 2019 than pre-2019, i.e. there is a generaltendency towards more diversified UoP. Thisis despite the share of the top 3 categories
remaining the same.
For example, non-financial corporates
financed Energy, Buildings, and Transport
respectively 64%, 18% and 4% pre2019 versus 52%, 21% and 13% in
2019. Sovereigns saw also saw morediversification but across categories. The
clearest exceptions are government-backed
entities and local governments, with further
concentration in Transport.

UoP by issuer type: 2019
EnergyBuildings

Transport

Water

Waste

Land use

Industry

ICT

Unallocated A&R

Non-Financial
Corporate
Loan
Financial
Corporate
Development
Bank
GovernmentBacked Entity
Local Government
Sovereign
ABS
40

20

0
USD Billions

60

UoP by issuer type: pre-2019 (i.e. up to 2018)
EnergyBuildings

Transport

Water

Waste

Land use

Industry

ICT

Unallocated A&R

Non-Financial
Corporate
Loan
Financial
Corporate
Development
Bank
GovernmentBacked Entity
Local Government
SovereignABS
0
USD Billions

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

40

80

120

9

Currency
EUR accounts for 40% of 2019
volumeThe share of the top 3 currencies – EUR,
USD and CNY – totalled 81% in 2019. It
reached a peak of 90% in 2016 and has
been declining since. This has largely been
due to i) relatively flat volume from locallydenominated Chinese bonds, which in 2019fell 10%, and ii) especially weak USD volume
in 2018.
By contrast, the EUR has been growing
robustly in both volume and share overthe last five years. With USD108bn in 2019(first time a currency has passed USD100bn
in a single year), the EUR overtook the USD
in cumulative volume, reclaiming the lead it
had lost in 2015.
The top eight currencies have remained
the same in the last few years, withdenomination in SEK and JPY growing
particularly fast. Almost all of this stems
from issuance by Swedish and Japaneseentities, mostly non-financial corporates. In
2019, SEK cemented itself as the fourth most
preferred currency – not far behind CNY –while JPY jumped from eight to fifth place.

Currency diversification

Share of EUR rising, USD flat, CNY falling
100%

80%

60%

40%

20%

0
2016
EUR

CNY

SEK

AUD

CAD

2019
GBP

JPY

Other

EUR reclaims cumulative lead from USD
300
EUR

USD

Other

250

It is natural for the share of hard currencies
to fluctuate less as the market becomes
more mature, but over time we still expect
this to drop gradually as EM issuance grows
and EM issuers choose to denominate morein their local currencies.

200

150
USD Billions (Cumulative)

This is a sign of continuing diversification
and appeal to a wider range of domestic
issuers. Greater local volumes of local
currency issuance can help improve thevisibility of domestic markets to foreign
green bond investors.

USD

2018

Note: ‘Other’ includes 26 currencies in 2019, and 32 in total (see Appendix).

The share of hard currencies was 83% in
2019, in line with the cumulative total of
82% and between the 80-85% range of thelast three years.

2019 saw denomination in four new
currencies: DKK (two deals, USD902m),
CZK (one, USD52m), KES (one, USD41m),
BBD (one, USD1.5m). A total of 34
currencies were used during the year.

2017

100

50

0
2014

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

2015

2016

2017

2018

2019

10

Deal Size, Tenors and Bond Types
32% of volume in USD500m-1bn Increasing volume in larger size brackets
range
0-100mThe average green bond deal size jumped
considerably from USD108m in 2018 to
USD144m in 2019. This is largely due toFannie Mae issuing a greater volume but
from less deals, pushing the average up;
excluding FM, the average deal size dropped
from USD308m to USD291m.

However, a robust base of smaller issuers is
also positive, demonstrating that the market
is an effective source of capital for various
profiles of issuers, including those withlower financing needs; as is often the case,diversity is a sign of resilience.

Regional diﬀerences
Europe has the biggest pool of benchmark-sizebonds by a substantial margin, especially in
the USD1bn+ category. The average European
deal size is therefore the highest, standingat USD366bn, while its median of USD114m
is in line with the global median. This showsthe effect a few very large deals can have.
North America is almost the opposite. Even
when FM is excluded, it has the highest shareof deals up to USD500m due to US Munis.

2018

20

0
2016

2019

Europe has highest share of large deals by some margin
500m-1bn

100-500m

1bn or more

Average

Median

25%

100

0

0

er

h
rt
No

No

rt

h

Am

er
Am

La
tin

ia
-P
ac
i

(e Am
xc er
l. ica
FM
)
Su
pr
an
at
io
na
l

200

ic
a

50%

ic
a

300

Eu
ro
pe

75%

fic

400

a

100%

USD Millions

0-100mAs

In 2019, the top 10 deals combined accounted
for 11% of the global market. A total of 45
bonds of USD1bn or more, from 36 different
issuers, came to market (172 benchmark-size,i.e. USD500m or more). The vast majority,
particularly the largest ones, were issued
by sovereigns, financial corporates (mainly
Chinese), development banks (both nationaland supranational), and large governmentbacked entities (especially European).

2017

40

ic

Larger deals can provide more liquidity anddepth to the market, attracting additional
investors and mainstreaming the green bondmarket through inclusion in broad market
indices, while also allocating more funds togreen projects from a single issuance.

1bn or more

60

Af
r

Looking at different size brackets, the USD0100m interval was relatively flat versus
the others, which all rose significantly. The
USD500m-1bn range increased the most in
both absolute and percentage terms, almost
doubling from USD46bn to USD82bn.

500m-1bn80

USD Billions

A similar trend is observed with the mediandeal size, which increased from USD21m to
USD31m for the total market, but fell slightly
from USD122 to USD119m when excluding
FM. (Growth in median size indicatesthat more issuers are issuing larger deals,
whereas growth in average size is driven
more by the volume of larger deals.)

100-500m

Top 10 issuers in 2019 (excluding Supranationals)
Developed Markets

Certified Emerging Markets

1 Fannie Mae (US)ICBC (CN)2 KfW (DE)

Industrial Bank Co., Ltd (CN)

3 Dutch State Treasury Agency (NL)

Noor Energy 1 (UAE)

4 Republic of France (FR)Republic of Chile (CL)

5 SNCF (FR)Republic of Poland (PL)

6 Engie (FR)China Construction Bank (CN)

7 Société du Grand Paris (FR)Bank of Jiangsu (CN)

8 Kingdom of Belgium (BE)

China Development Bank (CN)

9 Crédit Agricole CBI (FR)MAF (UAE)

10 Kommuninvest (SE)Islamic Development Bank (SA)Green Bonds Global State of the Market 2019 Climate Bonds Initiative

Certified11

But as this is heavily concentrated in the
USD100m-500m range (not USD0-100m),
the region has the highest median(without FM).

Volume increasing more among longer tenors17
Up to 5Y

Asia-Pacific has the most even size
distribution, with at least 10% in every
range and a 50:50 split between benchmarkand non-benchmark-size deals.

2019

Latin America exhibited the second largest
USD1bn or more share, while in Africa there
were none of this size.

2018Green bonds were longer-dated
in 2019
There was a significant change in the
distribution of bond tenors in 2019,
essentially away from shorter terms towards
longer ones. This is despite volumes
increasing across all tenor ranges.
2018 had seen a marked shift towards
shorter terms, most probably largely a resultof higher market volatility and rising interest
rates. The opposite happened in 2019, which
may be partly associated with a reversal ofthese trends as the market recovered andinterest rates remained low.
Overall, the use of longer tenors increased
far more than shorter ones, with thegrowth being largest the longer the term.
This is most noticeable in the 20Y+

5-10Y

10-20Y

Perpetual

Over 20Y

N/A

2017

2016

0
USD Billions

20

40

bracket, which more than doubled involume to USD39bn following a 41% dropin 2018; this took its share from 10%
to 15%. The next largest movers werethe 10-20Y and 5-10Y intervals, which
respectively increased 62% and 56%.
Bonds with a term under 5Y were up by
18%, versus 55% in 2018.

60

80

100

Within the other categories, perpetuals
continued their steady growth, although
at 20% this was below the overall market.
Around two-thirds of perpetual volume camefrom energy companies Engie and Iberdrola,both with one deal. Finally, driven by theincrease of green loans, the N/A category
more than tripled to USD6.7bn.

Sukuk leads bond type diversification
Sukuk: Malaysia has biggest pool of bonds and issuers
UAE, Saudi Arabia and Indonesia dominate volume
Amount issued

The most interesting development is thegrowth of green sukuk, which are becoming
more popular in Islamic countries. Green
sukuk volume more than tripled in 2019,reaching USD4.3bn from eight issuers infour countries. They spanned various issuer
types, with renewable energy - mainly
solar - being the most funded category. Our
ASEAN and GIIO reports explore this topic
in more detail.18, 19

USD Billions

More broadly, though, there is a generalmarket trend of increased diversification to
include other bond types, to be expected
in a growing and maturing market.

Deals

Issuers

2.0

6

1.0

3

0

0
UAE

Saudi Arabia

Indonesia

Number of deals/issuers

Within bond formats, there were no obvious
changes versus 2018, certainly among themost common types. The share of the top 10
was unchanged at 86%. Senior unsecured
deals remained the most prevalent,
accounting for almost half of the market,
although the subordinated unsecured format
experienced one of the largest increases,
more than doubling to USD14bn. Secured
debt prevailed as the second largest
category, as usual driven by Fannie Mae.

Malaysia

Note: Ordered by size, the eight sukuk issuers of 2019 were: MAF (UAE, two deals),
Islamic Development Bank (Saudi Arabia), Taweelah IWP (UAE), Republic of Indonesia,
PNB (Malaysia, two deals), Cypark Ref Sdn Bhd (Malaysia), Edra Solar Sdn Bhd(Malaysia), and Pasukhas Group (Malaysia).

Green Bonds Global State of the Market 2019 Climate Bonds Initiative12

External Reviews
More external reviews forsmaller deals
86% of the amount issued had some formof external review in 2019. Second party
opinions (SPO) remain the preferred option
by far, accounting for almost two-thirdsof the total market; however, Certification
under the Climate Bonds Standard
increased most, almost doubling in volume
to USD45bn and cementing itself as thesecond largest category. On the other hand,green bond ratings – typically provided bycredit rating agencies – were relatively flat at
USD8bn and assurance dropped from about
USD21bn to USD16bn.
A similar trend is observed looking at deal
count, except that here the increases are
more significant for all types of review; forexample, the number of deals with an SPO
increased 75% compared to 55% by volume(even despite less deals by Fannie Mae,
which benefit from a CICERO SPO). Thissuggests that, on average, more smaller
deals are obtaining external reviews.

It is also worth noting that several deals
benefit from multiple types of review,the most common case clearly being
Certification + SPO. Curiously, some of thelargest issuers of Certified Climate Bonds
chose to also obtain an SPO, most notably
Société du Grand Paris, the Republic of Chile,and Germany’s EnBW.
Furthermore, a total of USD3.1bn issued
between 2016 and 2018 benefitted fromthree forms of external review: Certification+ SPO + Green Rating.

86% of issuance had at least one form of external review; 6% had multiple
Green rating 3%
Assurance 5%

Certification +Green Rating
0.4%

SPO + Green Rating 2%
Assurance + Green Rating 6%
SPO + Assurance 6%

Certification
12%

None
14%
Multiple 6%

SPO
60%

Certification + SPO
86%

Regional diﬀerences

The use of external reviews varies by region
None

SPO

Certification

Assurance

RatingMultiple

The profile of external reviews varies
considerably by region.
Africa technically has the highest shareof review with seven out of seven deals
reviewed, five of which were Certified
Climate Bonds.

100%

75%

Europe follows with 97%, largely composedof SPO, with Latin America next at 96%(LatAm’s volume is dominated by multiple
reviews due to Chile’s sovereigns, but mostdeals only had an SPO).

50%

Asia-Pacific has the most even distributionof review types, while, driven by the US
Muni market, North America features a highshare without any review (only surpassed bySupranational entities).

25%

na
l

a
Su

er
Am
h
rt
No

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

pr
an
at
io

ic

a
ic
er
Am
La
tin

Eu

ro
p

e

c
-P
ac
ifi
As

ia

Af
r

ic

a

0

13

Certified Climate Bonds
Certification under the Climate Bonds
Standard reached its highest share of themarket yet in 2019, at 17% (14% in 2018,
14% cumulative), with 44% of the Certified
volume to date coming during the year. The
cumulative amount from Certified Climate
Bonds has now passed the USD100bn mark.
Unlike in 2018, allocations to Transport
accounted for 50% of the Certified volume,
more than Energy and Buildings combined.
Almost all the largest issuers financed
Transport to some extent.
The top 5 issuers of Certified Climate Bonds
in 2019 were:Dutch State Treasury Agency (Netherlands):
one deal, USD6.7bn, to finance renewableenergy, energy efficiency in buildings,
transport, and water infrastructure (including
adaptation).
SNCF (France): nine deals, USD4bn, forvarious rail projects, including maintenance,
upgrades, and energy efficiency as well as
new rail lines and extensions to existing lines(for both passengers and freight).
Société du Grand Paris (France): six
deals, USD3.6bn, to finance rail and metro
expansions around Paris, including 200 km
of new metro lines, 68 metro stations andseven supporting technical centres. The
entire project is funded via green bonds, with
Programmatic Certification.20
Noor Energy 1 (UAE): one deal, USD2.7bn,
to develop a 950MW solar CSP + PV projectsouth of Dubai. This is the first Certified deal
in the Middle East.
Republic of Chile: two deals, USD2.4bn,
mainly to finance upgrades and extensions
to Santiago’s metro network, as well asTransport dominates within Certified Climate Bonds
EnergyBuildings

Transport

Water

Waste

Land use

Industry

ICT

Unallocated A&R

20

20

30

2019

2018

2017

2016

2015
0
USD Billions

investments in electromobility, sustainablebuildings, water management and solar
energy across the country. Chile has alreadytapped these deals and issued another two in
2020, totalling USD3.8bn.

External review providers
CICERO remained the leading SPO provider
in 2019, representing 40% of the amountissued, followed by Sustainalytics (29%) andVigeo Eiris (16%). However, this is driven
by Fannie Mae; excluding it, Sustainalytics
would be first (although by a mere
USD0.3bn).
By number of issuers, Sustainalytics leads
with 88 versus CICERO’s 69, while by deal
count CICERO is top, with 202 deals against
Sustainalytics’ 119 (excluding FM). The figures

40

50

suggest that, compared to other providers,
CICERO engages with relatively fewer issuers
but these tend to issue more bonds.
Many SPO providers are also Approved
Verifiers for Certifications under the
Climate Bonds Standard. Sustainalytics led
amongst verifiers, accounting for over half(52%) of the Certified volume and 40% of
deals.
An increasing number of issuers without
an external review are providing similar
information to what would go into a green
bond framework in the offer prospectus. As
prospectus disclosure is reviewed by legal
counsel, technical advisors and auditors,
this provides a degree of comfort on green
claims, but a separate external review would
nonetheless strengthen disclosure.

External reviews
External reviews from an independent party confirm alignment
with the GBP/GLP and/or compliance with the Climate Bonds
Standard. The most common forms of review are:Assurance: external confirmation of compliance with GBP.
Second Party Opinion (SPO): external assessment of the issuer’s
green bond framework, confirming compliance with GBP andanalysing the eligible categories.

Certified Climate Bonds

Green bond rating/evaluation: evaluation against a third-party
rating methodology, which considers the environmental aspects of
the investment (separately from credit ratings).

Issuers can certify green issuance under the Climate Bonds
Standard.21 Certification confirms that the bond is aligned to theParis Agreement, i.e. keeping global warming under 2°C.

Verification for Certified Climate Bonds: third-party verification,pre- and post-issuance, which confirms that assets adhere to the
Climate Bonds Standard and Sector Criteria.

A third-party Approved Verifier assesses compliance of the assets
with the Climate Bonds Standard and Sector Criteria. Annual postissuance verification is then required to maintain Certified status.

Green Bonds Global State of the Market 2019 Climate Bonds Initiative14

Appendix: Yearly green bond volume by currency (in USD)
2007
EUR
USD
CNY
SEK
AUD
CAD
GBP
JPY
CHF
HKD
BRL
NOK
ZAR
SGD
NZD
INR
TWD
MYR
TRY
MXN
DKK
THB
COP
PHP
PLN
KRW
RUB
MAD
IDR
CLF
HUF
NGN
ISK
PEN
CZK
FJD
KES
VND
NAD
BBD
Total

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

480m

51m
3m
290m 665m

748m
585m

4.3bn
5.3bn

16.8bn11.2bn
208m
3.0bn
680 m
1.1bn
1.3bn
357m
388m

15.0bn22.5bn
95m
1.4bn
923m
551m
2.6bn

20.6bn38.0bn17.7bn
3.3bn
911m
916m
711m
98m

12m 460m
786m 96m
68m
661m 146m 1132m 124m

512m
461m
247m

74m
426m
67m

533m
123m
74m

483m

67m

236m
44m

97m
420m

26m
654m

3m
60m

259m
27m

290m
17m

6m
186m

56.1bn71.2bn15.6bn
4.1bn
2.1bn
1.5bn
1.2bn
853m
688m
253m
152m
788m
77m
440m
835m
905m
67m
479m
111m
10m

807m

414m

429m

234m
1.3bn

29m
124m
10m

631m 608m
168m
84m

1m

192m

5m
4m
214m
102m

8m
119m
135m

115m
226m

91m

216m

20m
67m

12m

23m
6m

89m

5m

16m
7m

167m
43m

68m

4m

41m
30m
42m
29m
27m

807m

414m

909m

4.3bn

1.3bn

3.5bn 11.3bn 36.8bn 44.5bn

84.5bn 158.0bn

2018

2019

Total

66.4bn 108.0bn 288.8bn
55.3bn 82.4bn 287.9bn
75.5bn19.9bn22.0bn13.2bn 35.4bn
7.9bn
15.8bn5.4bn
4.2bn
13.7bn4.8bn
4.8bn
12.5bn4.2bn
2.5bn
10.6bn
6.6bn
2.5bn
3.8bn
2.3bn
450m
3.8bn
2.1bn
1.5bn
3.7bn
896m
210m
3.6bn
1.6bn
170m
3.4bn
751m
93m
3.0bn
1.7bn
876m
2.2bn
300m
136m
2.1bn
3m
51m
1.5bn
1.0bn
478m
1.4bn
660m
223m
1.1bn
81m
1.0bn
135m
370m
902m
902m
887m
734m
153m
654m
52m
181m
623m
287m
110m
519m
499m
387m
110m
277m
216m
4m
205m
38m
178m
50m
149m
83m
67m
141m
100m
136m
107m
132m
98m
33m
102m
30m
30m
52m
52m
48m
19m
41m
41m
27m
5m
5m
2m
2m
171.2bn 258.9bn 776.3bn

Endnotes
1. Climate Bonds Green Bond Database, Climate Bonds
Initiative, 2020.
2. 2019 Green Bond Market Summary, Climate Bonds
Initiative, February 2019.
3. Green Bond Principles, ICMA, June 2018.
4. Green Loan Principles, LMA, December 2018.
5. Climate Bonds Taxonomy, Climate Bonds Initiative,
January 2020.
6. Climate Bonds Sector Criteria, Climate Bonds Initiative,
2020.
7. Climate Bonds Standard, Climate Bonds Initiative, 2020.
8. Climate Bonds Green Bond Database, Climate Bonds
Initiative, 2020.
9. Sustainable Finance, European Commission, 2020.
10. Climate Bonds Standard V3.0, Climate Bonds Initiative,
2020.
11. Climate Resilience Principles, Climate Bonds Initiative,
2020.

12. Figures refer to the issuer’s domicile, defined as countryof risk. This is not necessarily the domicile of the issuingentity, e.g. if its parent is from another country, the parent’s
domicile would be ‘country of risk’.
13. The increase in non-financial corporate issuance isparticularly positive given strong demand from investors forthis issuer type, as uncovered in our Green Bond European
Investor Survey 2019. Sovereigns are also highly in demand.
14. Unalloc. A&R = Unallocated Adaptation & Resilience,
i.e. funding for A&R projects/assets that we are unable
to allocate/specify to the other UoP categories. The dropin ‘Unalloc. A&R’ volume versus 2018 is due to a change
in the name and definition of this category in 2019;previously, all A&R was included (i.e. not just unallocated/ unspecified A&R).
15. Use of proceeds figures are estimates based on
the Climate Bonds Initiative Green Bond Databasemethodology.

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

16. The State of World Fisheries and Aquaculture: Meeting
the Sustainable Development Goals, FAO, 2018.
17. Green Infrastructure Investment Opportunities (GIIO)
Programme, Climate Bonds Initiative, 2020.
18. For deals with multiple tranches and maturity dates, thelongest term is used. N/A applies when we are not able tofind the maturity or when the deal is a loan without term.
19. ASEAN Green Finance State of the Market 2019, Climate
Bonds Initiative, April 2020.
20. Programmatic Certification, Climate Bonds Initiative,
2020.
21. Climate Bonds Standard, Climate Bonds Initiative, 2020.

15

Climate Bonds Taxonomy
The Climate Bonds Taxonomy identifies the assets and projects needed to deliver a low
carbon economy and gives GHG emissions screening criteria consistent with the 2-degree
global warming target set by the COP 21 Paris Agreement. More information is available athttps://www.climatebonds.net/standard/taxonomy.

ENERGY

WATER

Solar

Private transport

Water monitoring

Residential

Agriculture

Cementproduction

Preparation

Broadband
networks

Wind

Public passenger
transport

Water storage

Commercial

Commercial
Forestry

Steel, iron &aluminium
production

Reuse

Telecommuting
software andservice

Geothermal

Freight rail

Water treatment

Products &systems for
efficiency

Ecosystem
conservation& restoration

Glass
production

Recycling

Data hubs

Bioenergy

Aviation

Water distribution

Urban
development

Fisheries &aquaculture

Chemicalproduction

BiologicaltreatmentPowermanagement

Hydropower

Water-borne

Flood defence

Supply chain
management

Fuel production

Waste to energy

MarineRenewables

BUILDINGSLAND USE &MARINERESOURCES

TRANSPORTINDUSTRY

Nature-based
solutions

Transmission &distribution
Storage

WASTE

ICT

Landfill

Certification Criteria approved

Radioactive waste
management

Criteria under development
Due to commence

Nuclear

06/2020

Author: Miguel Almeida
Contributors: Krista Tukiainen, Caroline Harrison, Andrew Whiley
Suggested citation: Almeida, M. Global Green Bond State of theMarket 2019, Climate Bonds Initiative, July 2020.
Design: Godfrey Design

Prepared by Climate Bonds Initiative.

© Published by Climate Bonds Initiative, July 2020www.climatebonds.net

Disclaimer: The information contained in this communication does not constitute investment advice in any form and the Climate Bonds Initiative is not an investment adviser. Any reference
to a financial organisation or debt instrument or investment product is for information purposes only. Links to external websites are for information purposes only. The Climate Bonds
Initiative accepts no responsibility for content on external websites. The Climate Bonds Initiative is not endorsing, recommending or advising on the financial merits or otherwise of any debt
instrument or investment product and no information within this communication should be taken as such, nor should any information in this communication be relied upon in making any
investment decision. Certification under the Climate Bond Standard only reflects the climate attributes of the use of proceeds of a designated debt instrument. It does not reflect the credit
worthiness of the designated debt instrument, nor its compliance with national or international laws. A decision to invest in anything is solely yours. The Climate Bonds Initiative accepts noliability of any kind, for any investment an individual or organisation makes, nor for any investment made by third parties on behalf of an individual or organisation, based in whole or in parton any information contained within this, or any other Climate Bonds Initiative public communication.

Green Bonds Global State of the Market 2019 Climate Bonds Initiative

16