KfW doubles green bond portfolio
Press Release from 2017-05-22 / Group, Investor Relations, Sustainability
- Target volume of promotional green bond portfolio increased to EUR 2 billion
- KfW continues to actively support sound market development
- Federal Ministry for the Environment backs KfW’s activities as green bond investor
KfW amplifies its green bond investment activities. Since 2015, KfW has been building up a dedicated green bond portfolio backed by a promotional mandate from the German Federal Ministry for the Environment. As the portfolio is growing faster than initially planned, KfW now doubles the target volume from EUR 1 billion to EUR 2 billion with an investment horizon of 3 to 5 years. Moreover, KfW will keep actively contributing to the further establishment of high quality market standards. The Ministry for the Environment supports KfW’s continued efforts as a green bond investor and extents its promotional mandate accordingly.
Jochen Flasbarth, State Secretary at the Ministry for the Environment: “The green bond market enables the financing of climate and environmental protection through private capital. This is essential to the fight against climate change and to the establishment of a resource-efficient economy. The transition towards a low-carbon society and the financing of sustainable infrastructure cannot be achieved by public funds alone.”
Dr Günther Bräunig, Member of the Executive Board of KfW in charge of Capital Markets: “We are pleased by the positive response to our engagement in the green bond market. KfW is recognised as an important investor and our feedback is welcomed by market participants. However, the quantitative and qualitative market development is not yet completed. We therefore continue our engagement in the green bond market and further support its development through investments and initiative.”
KfW has been promoting climate and environmental protection by purchasing green bonds since April 2015. Through its investment activities, KfW employs a capital market-based instrument to provide financing for environmental and climate protection measures. In addition, KfW engages in an active dialogue with various market participants, being a sounding board for green bond issuers and parties active in the market like audit firms, rating agencies, sustainability rating agencies and other stakeholders. Furthermore, KfW stands up for the development of sound practices in market initiatives. For example, KfW is member of the Executive Committee and in working groups of the internationally renowned Green Bond Principles, voluntary guidelines for the issuance of green bonds developed by market participants. An update of the Green Bond Principles is scheduled for June.