The European Investment Bank (EIB), the EU Bank owned by the EU Member States, increased the 0.500% Climate Awareness Bond (CAB) November 2023 by EUR 500m, bringing the total amount outstanding to EUR 1.5bn. Crédit Agricole SA is one of the main investors of the tap, in the context of its recent commitment to invest EUR 2 billion in high quality Green Bonds.EIB’s CABs have been awarded a Sustainability Bond Rating of ‘b+’ from Oekom, one of the leading ESG rating agencies worldwide. This is the highest rating so far assigned by the agency.
The transaction, which takes the total CAB issuance to EUR 11.8bn, highlights EIB’s commitment to the sustainable growth of the Green Bond market by increasing the liquidity of EIB’s EUR Green Bond curve. The EUR 1.5bn CAB due 11/2023 provides a benchmark of intermediate maturity between the EUR 3bn ECoop CAB due 11/2019, currently the largest Green Bond outstanding, and the EUR 1.25bn CAB due 2026 – the longest outstanding Green benchmark. In EUR, CABs are distributed in mini-benchmark / ECoop format. This means they have a EUR 500m minimum size, and EUR 250m minimum for re-openings upon actual demand.
As in 2015, EIB is first to issue a Green Bond in 2016, thereby drawing attention to their relevance in the current policy and market context. Transparency and accountability are among the key features of the recent Paris agreements of COP21. The delivery of climate goals is not only a question of volume; it implies a wide-ranging transformation of business practice, and the credibility of climate finance is crucial for the effective involvement of capital markets.
Green Bonds enhance the transparency of climate finance and promote the debate on definitions, impact assessment methodologies and impact reporting principles, permitting stakeholders to increasingly engage for higher comparability and improvement in these fields. This engagement is essential for a shift from financing climate activities in incremental ways, to making climate change – both in terms of opportunities and risk – a core consideration and “lens” through which institutions deploy capital.