World Bank Re-Enters The Danish Green Bond Market; Six Nordic Funds Invest

December 3, 2019 | ESG and Sustainability, News
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Six Nordic funds have enthusiastically subscribed to the World Bank’s 20 years, DKK 3 billion (USD 441 million) Danish green bond issue.

World Bank first issued its debut green bonds in Denmark in 1997. They were the first and longest maturity green bonds issued in that market. However, after a hiatus of 22 years, the World Bank has returned to Denmark with a Danish green bond issue of DKK 3 billion (USD 441 million). Six Nordic funds subscribed to the issue.

Proceeds from a green bond issue finance renewable energy projects and improvement of energy efficiencies. The funds also invest in waste management and agriculture projects to reduce greenhouse gas emissions.

World Bank and Danish investors

“We are pleased to be back in the Danish market with our first DKK-denominated green bond,” said George Richardson, Director, Capital Markets, World Bank. “Investors are looking to connect their investments to develop solutions that address climate change and other global challenges that make a difference for people around the world.”

Accordingly, six Nordic funds plowed money into the World Bank’s green bonds:

  • 933 billion Danish kroner ATP, Hilleroed, Denmark;
  • 500 billion Danish kroner Danica Pension, Copenhagen;
  • 576 billion Danish kroner PFA Pension, Copenhagen;
  • 114 billion Danish kroner MP Pension, Gentofte, Denmark;
  • 140 billion Danish kroner PenSam, Farum, Denmark; and
  • 4 billion Swedish kronor ($38 billion) AP2, Gothenburg, Sweden

Further, a spokesman for PenSam said the bonds provided a good risk-adjusted return and were a fine way to support the green transition.

The green bonds were a fine case of long-term and sustainable investments, according to Lars Dreier Kristensen, senior portfolio manager in ATP. Further, they made it possible to combine a good risk-adjusted return with strong support for the green transition.

Issue managed by Skandinaviska Enskilda Banken AB (SEB)

SEB ran the World Bank’s Danish green bond issue.

Christopher Flensborg, Head of Climate and Sustainable Finance, SEB said: “The World Bank has over the last decade established a large number of collaborations with institutional investors to address and support the Sustainable Development Goals – and the World Bank’s Green Bond program has been a cornerstone to establish the current sustainable market platform.”

[Related Story: Pepsi Issues Its First ‘Green Bonds;’ These Align With UN Sustainable Development Goals ]

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