Amundi and the International Finance Corporation (IFC), part of the World Bank, have raised $1.42 billion (£1 billion) for their green bond fund last week.
The Amundi Planet Emerging Green One (Ego), which has now closed to new investment, will have a seven year life, over which time it aims to deploy $2 billion into emerging market green bonds, after reinivesting its proceeds over that period. It is listed on the Luxembourg Stock Exchange
The fund will also support the creation of a more liquid and varied green bond market through ‘tailored capacity building activities’. This will included supporting new markets for climate finance by providing specialist training programmes for emerging market bankers and help spread the word of green bond issuers to the wider global market.
IFC is a cornerstone investor, having committed $256 million, and it has also received significant investment from a number of large pension funds, international development banks and asset managers.
To meet the fund’s goal of setting the market standard through the environmental and social requirements of the fund’s ESG policy, a scientific committee consisting of green finance experts from development institutions is being set up to advise Amundi as fund manager. The fund’s ESG policy reflects IFC’s 2012 Performance Standards and IFC’s Excluded Activities.
Amundi CEO Yves Perrier said: ‘This landmark transaction with IFC contributes to Amundi’s innovative and leading role in the climate finance space. Leveraging on Amundi’s emerging market debt investment capabilities, our commitment to ESG, and IFC’s unique outreach in emerging countries, Amundi Planet is a one-of-a-kind example of the potential that public private partnerships can bring to investors and to the society.’
Philippe Le Houérou, IFC CEO, added: ‘The global market for green bonds has expanded rapidly in recent years, totalling more than $155 billion in 2017, but few banks in developing countries have issued such bonds. IFC and Amundi expect this new fund to encourage more local financial institutions to issue green bonds, by increasing global demand and building local markets.’