In markets around the world, BNY Mellon is working to support clients in ways that have a positive impact on the environment and society, including by facilitating the issuance of green bonds. These securities are an innovative tool for driving capital to sustainable investment; in 2017, global green bond issuance totaled a record $155.5 billion, and volume could reach $250 billion to $300 billion in 2018, according to research from the Climate Bonds Initiative.
BNY Mellon is a listing member of the Luxembourg Green Exchange (LGX), the world’s leading platform dedicated exclusively to securities that are 100 percent green, social or sustainable. Luc Biever, Vice President, BNY Mellon Corporate Trust Luxembourg, sat down with Jane Wilkinson, Head of Sustainable Finance, LGX, to discuss the evolution of LGX and the market for green securities. “Green finance offers strong benefits and growth opportunities for stock exchanges,” Wilkinson told Biever. Green finance may also serve as a model for further innovation, including blue bonds to fund sustainable fisheries, gender equality bonds, and even pandemic bonds to channel surge funding to developing countries facing the risk of a health emergency.
In Lithuania, BNY Mellon Corporate Trust in 2017 facilitated the issuance of a €300 million green bond by the state-owned energy company, Lietuvos Energija. The financing is the first international corporate green bond in Central and Eastern Europe and reflects a drive by Lithuania to reduce its reliance on imported energy. Proceeds will go to bolster locally sourced energy, such as wind farms and other eco-generation projects, and to upgrade the country’s energy distribution network. BNY Mellon Corporate Trust served as fiscal agent, paying agent, transfer agent, registrar and listing agent where the bonds were listed on the Luxembourg Stock Exchange.
Brazil has the potential to become one of the world’s largest green investment markets; the Brazilian Development Bank issued a $1 billion green bond in May 2017. Brazil is expected to need $1.3 trillion in investment between 2016 and 2030, the highest in the region, to meet its environmental obligations under the global Paris Agreement and the United Nations Framework Convention on Climate Change. The Brazilian green bond is expected to fund environmental initiatives including wind and solar energy installations. BNY Mellon Corporate Trust served as trustee, registrar, and principal paying, transfer and listing agent. “Green bonds leverage Brazil’s key sector strengths and shift investments toward a low-carbon economy,” said Sonia Chaliha, BNY Mellon Corporate Trust Managing Director and Business Head for Latin America and Canada.
Read the 2017 CSR Report to learn more about the ways BNY Mellon is leveraging financial products and services to contribute to a more sustainable future.