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Press Release from 2014-07-15 / Group, Sustainability

‘Green Bonds – Made by KfW’ convince investors

  • KfW successfully issues largest Green Bond ever with a volume of EUR 1.5 bn
  • Strong demand of socially responsible investors
  • Positive feedback paves the way for further Green-Bond-issues

KfW debuts today with a new product in the capital market: KfW issued its inaugural Green Bond. A Green Bond is an interest-bearing security whose issue proceeds are used to finance environmental and climate protection projects.

The first ‘Green Bond – Made by KfW’ was issued with a volume of EUR 1.5 bn and is thus the largest Green Bond ever at the time of issuance in this segment; it has a maturity of 5 years and pays an annual coupon of 0.375%. Crédit Agricole, Deutsche Bank and SEB jointly act as lead managers of the transaction. Underlining the overwhelming interest by investors, the orderbook grew rapidly, reaching EUR 2.65 billion within a short period of time. The high granularity of the orderbook is particularly impressive: 90 investors participated in the Green Bond with an average ticket size of below EUR 30 mn.

„The issuance clearly shows that we hit the mark with our sustainable investment offering – our first Green Bond is a huge success. Especially the high degree of transparency and the unprecedented quality standards of our Green-Bond-concept convinced the investors”, Dr. Günther Bräunig, member of KfW’s Executive Board and responsible for capital markets summarises the results of the investor meetings, which took place in Europe in preparation of the issuance.

With the ‘Green Bond – Made by KfW’, KfW directly connects its financing of climate protection projects and the capital market for the first time. Investors benefit from the excellent credit and sustainability ratings as well as from the liquidity of KfW bonds, and simultaneously support climate and environmental protection.

The bond proceeds are linked to KfW’s environment investment program, “Erneuerbare Energien” (“KfW Renewable Energies Programme – Standard“). Thus, it is transparent to the investors that their capital invested is used to finance projects for the generation of power especially from wind and photovoltaics. Past results show that an investment of EUR 1 million results in a greenhouse gas reduction of 800 tons per year on average.

The positive and sustainable effects on the environment are certified by the independent, non-profit Center for Solar Energy and Hydrogen Research, Baden-Württemberg (ZSW). Furthermore, the qualified, independent research centre CICERO reviews and evaluates KfW’s Green-Bond-concept. These high market standards convince many investors.

„Generating profits and undertaking social responsibility at the same time, represents a traditional principle at Union Investment. We highly value that a ‘green investment’ is sustainably verifiable. Therefore, we are glad that KfW expands the investment opportunities with its innovative Green-Bond concept“, confirms Jens Wilhelm, member of the Executive Board and responsible for capital markets at Union Investment.

„As an asset manager for the insurance industry, we consider lasting returns and sustainability as interdependent. Both are indispensable when dealing prudently with risk. So I welcome the KfW’s initiative to issue Green Bonds”, affirms Dr. Thomas Kabisch, CEO of MEAG.

During the tenor of ‘Green Bonds – Made by KfW’, the use of proceeds is subject to ongoing monitoring and will be published quarterly on KfW’s website – this ensures high transparency for the investors.

The market for Green Bonds has grown considerably and almost doubled in size in 2014. KfW contributes significantly to take Green bonds out of the niche and into the broader market – investors appreciate these efforts. Cecilia Reyes, CIO of Zurich Insurance Group comments: “Zurich is pleased with KfW's robust support for the growing green bond market as an issuer, given their strong sustainable development track record and credit quality. We are especially impressed by the reporting framework put forward. It allows direct impact attribution and sets a market example we highly welcome".

The huge success of its inaugural Green Bond issuance is pointing the way ahead for KfW’s future activities in this market segment. „We intend to intensify the strategic dialogue about ‘responsibility in the capital market’ with our investors. Due to the positive feedback by the investors, a second green bond in our other core currency USD seems conceivable later in the year“, explains Bräunig.


KfW EUR Green Bond I/2014 – Details

ISIN: XS1087815483
Issuer: KfW
Guarantor: Federal Republic of Germany


- Aaa – stable (Moody’s)

- AAA – stable (S&P)

- AAA – stable (Fitch)

Sustainability Ratings (as of June 30, 2014):

- Imug: 1. out of 126

- Oekom Research: 3. out of 23

- Sustainalytics: 5. out of 191

Size: EUR 1.500.000.000

Tenor: July 22, 2014 – July 22, 2019

Coupon: 0.375%

Issue price: 99.473%

Yield: 0.482%

Listing: Luxembourg

Detailed information regarding the Green-Bond-concept, the use of proceeds of „Green Bonds – Made by KfW“ and the independent third-party opinions are available at www.kfw.de/greenbonds.


The information contained in this document does not constitute an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. KfW has not registered the securities that are the subject of this document for sale in the United States.


Portrait Nathalie Cahn


Nathalie Cahn

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