Sustainable debt issuance rises by 78% hitting $465bn globally

Written by Adam Cadle

09/01/2020

A new record was set in 2019 for the volume of sustainable debt issued globally in any one year, with the total hitting $465bn globally, up 78% from $261.4bn in 2018.

Last year also saw all-time, cumulative issuance of sustainable debt smash though the $1trn barrier, and reach $1.17trn by 31 December, based on latest figures of the sustainable debt universe captured by research company BloombergNEF (BNEF).

BNEF lead sustainability analyst Jonas Rooze said: “The steep increase is fuelled by end-investors’ concerns about the threat of climate change, and the desire of many big company, bank and government leaders to be seen as behaving responsibly.”

Sustainable debt covers a variety of instruments, from the well-established area of green bonds to the fast-emerging category of sustainability-linked loans. Green bonds, constituting more than half of the entire sustainable debt market in 2019, saw $271bn issued – up from $182bn in 2018.

BNEF also saw an almost-threefold increase in the volume of sustainability bonds issued last year, to a record $46bn.

“This is the biggest jump for sustainability bonds ever, showing interest from borrowers and investors in securities that combine support for both social and environmental activities,” said Mallory Rutigliano, green and sustainable finance analyst at BNEF.

Some of the most spectacular growth of all is being seen in sustainability-linked loans, now the second most popular thematic debt type. This category, consisting of loans linked to the borrower’s performance on defined environmental, social or governance (ESG) criteria, enjoyed a 168% jump in volumes to $122bn in 2019.

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