Green Bond Finance and Certification

16 Pages Posted: 26 Sep 2017

See all articles by Torsten Ehlers

Torsten Ehlers

Bank for International Settlements (BIS)

Frank Packer

Bank for International Settlements (BIS)

Date Written: September 17, 2017

Abstract

Financing of investments through green bonds has grown rapidly in recent years. But definitions of what makes a bond "green" vary. Various certification mechanisms have evolved to allow more granularity as well as continuity in assessment. Green bonds have been priced at issuance at a premium on average relative to conventional bonds, but their performance in the secondary market over time has been similar. A relatively large share of green bonds are in sectors subject to environmentally related credit risks. More consistent green bond standards across jurisdictions could help to further develop the market.

JEL Classification: G24, O16, Q50

Suggested Citation

Ehlers, Torsten and Packer, Frank, Green Bond Finance and Certification (September 17, 2017). BIS Quarterly Review September 2017. Available at SSRN: https://ssrn.com/abstract=3042378

Torsten Ehlers (Contact Author)

Bank for International Settlements (BIS) ( email )

Centralbahnplatz 2
Basel, Basel-Stadt 4002
Switzerland

Frank Packer

Bank for International Settlements (BIS) ( email )

CH-4002 Basel, Basel-Stadt
Switzerland
4161 280 8449 (Phone)

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