The International Finance Corp. (IFC), a member of the World Bank Group, has issued its first Canadian dollar green bond, raising C$750 million ($567 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.
"It was a ground-breaking debut green bond by IFC in a new currency,” said Sean Hayes, managing director and head of U.S. syndicate at BMO Capital Markets. “This Canadian dollar deal reached new investors, achieved IFC’s largest Canadian dollar transaction, and priced at the tightest spread to the Canadian mortgage bond curve ever by an international sovereign, agency or supranational issuer. Investment for impact was on showcase with the investor take-up on this deal.”
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.
“Crowding in mainstream investors — as IFC has done today 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,” said John Gandolfo, IFC vice president and treasurer. “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.”
IFC is looking to increase its climate investments to 28 percent from its own account, and mobilize an additional $13 billion a year in private financing by 2020.
