IFC Raises $569 mn From 1st Canadian Green Bond

IFC has issued its 1st Canadian dollar green bond, raising USD 569 million for climate-smart business.

The International Finance Corporation (IFC), a member of the World Bank Group, has issued its first Canadian dollar green bond, attracting strong investor demand and raising CAD750 million (USD 569 million) for climate-smart business.

The proceeds of the five-year green bond – the largest Canadian dollar-denominated deal ever issued by IFC – will finance IFC investments in green projects, including renewable energy, green buildings, sustainable forestry, and energy efficiency.

John Gandolfo, IFC vice president, and treasurer said the “crowding in mainstream investors—as IFC has done with its first-ever Canadian dollar green bond—is critical to accelerate the development of the green bond market and find innovative climate finance solutions. Mobilizing private sector finance for ESG products like green bonds brings in billions of dollars of capital to sectors such as clean energy, waste management, energy-efficient buildings, transport and green banking.”

It has been reported that nearly 50 percent of the investments were local i.e. Canadian, followed by Asian (26 percent), EMEA (16 percent) and the Americas (8 percent).

IFC is one of the world’s largest financiers of climate-smart projects for developing countries and has been a leader in the green bond market since its first issuance in 2010. In 2013, IFC became the first institution to issue a $1 billion global benchmark green bond, helping to transform the market from niche to mainstream. IFC has now issued $9.5 billion of green bonds in 18 currencies since the beginning of the program.

Jigme Shingsar, managing director, RBC Capital Markets which is one of the lead managers said “IFC’s inaugural Canadian dollar green bond was timed to perfection and it highlighted IFC’s credit quality and consistent investor marketing program. IFC has long been a pioneer in the development of ESG bonds and this issue is an important milestone in the development of the Canadian green bond market.”

Recently, we reported that Tata Power Delhi Distribution Ltd (Tata Power-DDL), a distribution arm of Tata Power, has entered into an agreement with IFC to assess storage capacity requirement in it’s area. The motive behind the move is to ensure sustainable and reliable power distribution and to formulate a business model for storage deployment in distribution utilities.