Finland’s first green bond lists on London Stock Exchange

Finland’s first green bond lists on London Stock Exchange

  • Municipality Finance’s (MuniFin) 5 year dated green bond raises $500 million in London
  • Bond attracts strong international investor support
  • Proceeds will support MuniFin’s Green Framework projects
  • Enhances LSEG’s position as a leading international green and sustainable financing centre

London Stock Exchange welcomes today Municipality Finance (MuniFin), the leading provider of financial services to Finland’s local government and public housing sectors, to open trading to celebrate listing Finland’s first ever green bond.

The 5 year dated benchmark-sized green bond raised $500 million, with 1.48 per cent annual yield and secured high quality global investor support. The bond will be listed on London Stock Exchange’s Green Bond Segment, launched as a world first in 2015 to provide a new range of green fixed income funding options for issuers and investors.

MuniFin will use the proceeds of the green bond to invest in projects that promote the transition to low carbon and climate resilient growth across Finland. Eligible projects are identified in MuniFin’s Green Framework, which was drafted in accordance with the Green Bond Principles, a set of guidelines framing the issuance of green bonds and the Centre for International Climate and Environmental Research, Oslo and in collaboration with the Stockholm Environment Institute.   

To celebrate the listing, Nikhil Rathi, CEO, London Stock Exchange plc & Director of International Development, London Stock Exchange Group welcomed Pekka Averio, President and CEO, MuniFin, along with Hannele Pokka, Permanent Secretary, Finnish Ministry of Environment to open trading in London this morning.

Nikhil Rathi, CEO, London Stock Exchange plc & Director of International Development, London Stock Exchange Group:
“Welcoming MuniFin to London Stock Exchange’s Green Bond Segment today is an historic event: Finland’s first ever green bond has the potential to unlock and promote green financing across the country.

“Last year, London Stock Exchange was the first major exchange globally to launch a dedicated green bond platform and as a recognised world leader in green and sustainable finance, facilitating international investment from Finland to India, China and Japan, we believe there is an opportunity to be the funding partner of choice for the wider Nordic region. There is an undeniable shift in momentum in green and sustainable financing across the world and London Stock Exchange is uniquely placed with its extensive product offering and expertise to support issuers and inventors in this green funding revolution.”

Pekka Averio, President and CEO, MuniFin:
”We are proud to be the first Finnish green bond issuer. Most of our lending portfolio consists of investments that could be categorised as socially or environmentally responsible. As we are one of the most important credit institutions in Finland, we feel that we have a central role in raising environmental awareness in the Finnish public sector and encouraging our customers to make more environmentally friendly investments.

“Our aim is to support this change by offering a small margin discount for projects that are approved green financing. We have a long history with London Stock Exchange in connection with our previous bond issues and we are honoured to list our green bond on London Stock Exchange’s Green Bond Segment.”

Jyrki Katainen, Vice President, European Commission:
“This development is yet another example that sustainable financing is growing fast. The European Commission fully supports the alignment of investments with climate, resource-efficiency and other objectives in line with the Paris Agreement and the circular economy principles. Through the Capital Markets Union Action Plan we are aiming at facilitating investment in green technologies and ensuring that the financial system can finance growth in a way that is sustainable.”

London Stock Exchange Group is a pioneer in supporting the growing global green and sustainable financing movement, providing a comprehensive green and sustainable product offering.

  • 37 green bonds issued by international institutions, municipalities and corporates are listed on London Stock Exchange in 7 currencies, having raised over $9.3 billion
  • In 2016 alone, 11 new green bonds in 6 different currencies have raised approximately $3.6 billion
  • In 2015, LSEG launched a dedicated Green Bond Segment across its fixed income markets, offering a flexible range of market models, open to retail and wholesale investors
  • In June 2016, FTSE Russell launched its ground breaking data model that tracks companies that generate green revenues, a critical component missing from current sustainability models
  • FTSE Russell provides a series of indices making it easier for investors who are placing greater emphasis on environmental, social and governance considerations such as the FTSE4GOOD Index Series, Global ex Fossil Fuels Series and All-World ex Coal Index Series
  • There are 38 ‘green companies’ which have raised $10 billion combined in London including, 14 renewable investment funds
  • London Stock Exchange is home to a number of global first green bond issuances from India’s Axis Bank, China’s Agricultural Bank of China, Japan’s  Development Bank of Japan and the IFC, a member of the world bank group
  • LSEG is a member of the UN Sustainable Stock Exchange initiative

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