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TRUCOST: A Greenium? Is there a pricing advantage for green bonds in the primary market
A Greenium? Is there a pricing advantage for green bonds in the primary market
Following the Climate Bond Initiative’s recent report Green Bond Pricing In the Primary Market – Is There a Greenium?, S&P Global Ratings has produced an infographic exploring the market factors that conclude whether or not there is a pricing advantage for green bonds.
The infographic compares the spread performance and investor bases of vanilla and green bonds – using Apple’s bonds as a case study. Two key takeaways are:
• anecdotal evidence has suggested that green bonds are oversubscribed and may price tighter than expected; and
• green bonds attract a more diverse range of investors, and extra investor interest may lower the cost of funding.
Both the infographic and the CBI report are attached, and the infographic can be found online here.