Green Bond Pricing in the Primary Market: January - June 2019

The report analyzes 61 green bonds (USD 56.6bn) from H1 2019, finding that EUR green bonds generally outperformed vanilla equivalents in oversubscription and spread compression. While 53% of allocations went to self-declared green investors, two-thirds of the sample priced without a new issue premium, and 61% showed tighter spreads than comparable bonds 28 days after pricing. A sector spotlight reveals that half of EUR Utility bonds issued in Q2 2019 were green, significantly exceeding the global average for the sector.

• In the first half of 2019, EUR-denominated green bonds generally achieved higher demand and better pricing terms than their vanilla equivalents, with an average oversubscription of 3.9x compared to 3.3x for vanilla bonds, and average spread compression of -17bps versus -16bps.
• USD-denominated green bonds performed similarly to or slightly worse than vanilla equivalents in H1 2019, with an average oversubscription of 4.1x (compared to 4.5x for vanilla) and average spread compression of -19bps (compared to -20bps for vanilla).
• Approximately 53% of the funds raised by the sampled green bonds were allocated to investors who identified as green or socially responsible, a figure consistent with data from H2 2018.
• Two-thirds of the green bonds in the sample priced without a traditional new issue premium, and six specific bonds exhibited a 'greenium' (pricing inside their own yield curve), including the Netherlands 2040 (EUR) and Chile 2050 (USD).
• Secondary market performance showed that while only 46% of green bonds tightened more than comparable bonds seven days after pricing, this increased to 61% after 28 days.
• In the EUR Utility sector during Q2 2019, green bond issuance significantly outweighed vanilla issuance, with eight green bonds totaling USD 5.3bn compared to only two vanilla bonds.
• The report identifies a lack of a standardized definition for 'green investors,' though it highlights specific criteria used by Credit Agricole CIB, Citi, and the Dutch State Treasury Agency (DSTA) to identify such investors.

APA

Harrison, C., & Filkova, M. (2019). Green Bond Pricing in the Primary Market: January - June 2019. Climate Bonds Initiative. https://www.climatebonds.net/files/drupal-files/files/CBI_GB_Pricing_H1_2019_final.pdf

Chicago

Harrison, Caroline, and Monica Filkova. Green Bond Pricing in the Primary Market: January - June 2019. Climate Bonds Initiative, 2019. https://www.climatebonds.net/files/drupal-files/files/CBI_GB_Pricing_H1_2019_final.pdf.

Wikipedia

{{cite report |last1=Harrison |first1=Caroline |last2=Filkova |first2=Monica |title=Green Bond Pricing in the Primary Market: January - June 2019 |publisher=Climate Bonds Initiative |date=October 2019 |url=https://www.climatebonds.net/files/drupal-files/files/CBI_GB_Pricing_H1_2019_final.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{harrison2019green, author = {Harrison, Caroline and Filkova, Monica}, title = {{Green Bond Pricing in the Primary Market: January - June 2019}}, institution = {Climate Bonds Initiative}, year = {2019}, month = oct, url = {https://www.climatebonds.net/files/drupal-files/files/CBI_GB_Pricing_H1_2019_final.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }