Sustainability Bonds

Since 2015, the State of North Rhine-Westphalia regularly issues Euro Benchmark Bonds in sustainable format. The State wants to provide investors who seek sustainable investments with an opportunity to finance selected environmental and social projects of the State. At the same time, North Rhine-Westphalia contributes to the internationally growing segment of Socially Responsible Investments (SRI).

    Again Award for „Most Impressive Local Government Green/SRI Bond Issuer”

  • The State of North Rhine-Westphalia has won the award for “Most Impressive Local Government Green / SRI Bond Issuer" by the journal "GlobalCapital”. The State has received this award for the third time following awards in 2017 and 2019.
    The winners of the GlobalCapital awards were elected by market participants such as investors, investment banks and issuers. They therefore reflect the market's opinion on the most important achievements and innovations and the most impressive performers in 2020 and 2021. This award therefore shows the success of the State's Sustainability Bonds on the market, which is also regularly seen in the very strong interest shown by investors.

    New Framework for NRW’s Sustainability Bonds
  • The State of North Rhine-Westphalia has been issuing Sustainability Bonds since 2015 and is therefore one of the early players in this market. The State has now developed a new Framework for its Sustainability Bonds.
    The Sustainability Bond Framework sets out how the State‘s Sustainability Bonds relate to the State's sustainability strategy and explains the use of proceeds, the processes for project evaluation and selection, the management of proceeds and reporting. A revision of the Framework was necessary in order to take current developments in the financial markets into account and to align the Sustainability Bonds with the State's updated sustainability strategy, which is now more closely aligned with the United Nations Sustainable Development Goals (SDGs). The new Sustainability Bond Framework is therefore also more closely aligned with the SDGs. The Framework lists 14 categories that were developed by the International Capital Market Association (ICMA) for its Green Bond Principles (2018) and Social Bond Principles (2020). All Sustainability Bond projects will be assigned to one of these categories. NRW’s new Sustainability Bond Framework, which has been developed in alignment with the Green Bond Principles 2018, Social Bond Principles 2020 and the Sustainability Bond Guidelines 2018, is in line with the most recent drafts of the EU Green Bond Standard with regards to the Do No Significant Harm Principle and Minimum Social Safeguards. The Second Party Opinion from ISS ESG confirms that the Framework is consistent with the State’s sustainability strategy and material ESG topics for sovereign and sub-sovereign issuers and that it is in line with the Green Bond Principles, Social Bond Principles and Sustainability Bond Guidelines.
    NRW Sustainability Bond Framework
    Second Party Opinion from ISS ESG

  • Upgrade to top grade "advanced" in the sustainability rating of Vigeo Eiris
  • In the sustainability rating of the agency Vigeo Eiris (Paris), which cooperates with the rating agency imug (Hanover), the state of North Rhine-Westphalia received an upgrade in the current ESG rating of European regions which was published in January 2020. The overall rating improved from "robust" to the top rating of "advanced". North Rhine-Westphalia is now the best of a total of 29 assessed regional and local authorities across Europe. In previous years, the country was in third place, which was the best result of all German States.
    The rating covers a wide range of topics. In addition to environmental issues, human resources, human rights and governance are also assessed. The results of sustainability ratings are important for the State in refinancing, as some investors use the sustainability of an issuer as a criterion for an investment.

  • Award for „Most Impressive Local Government Green/SRI Bond Issuer”
  • The State of North Rhine-Westphalia has won the award for “Most Impressive Local Government Green / SRI Bond Issuer" by the journal "GlobalCapital" in 2018/2019.
    The winners of the GlobalCapital Sustainable and Responsible Capital Markets Awards were elected by market participants such as investors, investment banks and issuers. They therefore reflect the market's opinion on the most important achievements and innovations and the most impressive performers in the year from July 2018 to June 2019.
    Winners of the 2019 GlobalCapital SRI Awards

  • Moody's reports on State’s Sustainability Bonds
  • The rating agency Moody's reports on the Sustainability Bonds of the State of North Rhine-Westphalia and praises the pioneering role of the State. Moody's considers the State’s development in this market segment to be credit positive.
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At the end of May 2021, the State of North Rhine-Westphalia issued its eighth Sustainability Bond with a record volume of 3.5 billion euros (tenors of 10 and 20 years) to finance social and environmental projects of the State. For the first time, the Bond was issued in compliance with the new framework. The Bond finances projects from areas such as health, education, research, infrastructure as well as environmental and climate protection. Several projects serve to deal with the pandemic. The Sustainability Bond is targeted in particular at investors focusing on Socially Responsible Investments (SRI).

The State of North Rhine-Westphalia issued its seventh Sustainability Bond on October 5, 2020. The bond has a size of 2.4 billion € and a tenor of 15 years and serves to finance social and environmental projects of the State. Projects belong to areas such as health, education, research, infrastructure and environmental protection. With this bond, the State particularly reaches out to investors who seek sustainable and responsible investments.

© Mintr/shutterstock.com

The State of North Rhine-Westphalia successfully placed its sixth Sustainability Bond with a total volume of € 2.5 billion on the market on November 19 2019. The bond was issued for the first time in two tranches with different maturities of ten and 20 years. Net proceeds finance environmental and social projects of the budgetary year 2019. The bond particularly targets investors focusing on socially responsible investments.

Following a roadshow through European and Asian countries in February and early March 2019, which served to present the concept of the fifth Sustainability Bond to institutional investors, a bond with a volume of € 2.25 billion was successfully placed on the market on 6 March. The Sustainability Bond is particularly targeted at investors who value sustainable and responsible investments and is used to refinance social and environmental projects, such as education, research and infrastructure.

After a series of investor meetings throughout Asia and Europe in February and early March 2018 the Sustainability Bond #4 was issued on 6 March 2018 with a volume of EUR 2.025bn. The bond is designed for investors focusing on Socially Responsible Investments (SRI).

After a series of investor meetings throughout Europe in February 2017  the Sustainability Bond #3 was issued on 28 February 2017 with a volume of EUR 1.825 bn.

Rechte: iStock/K.Lipa

Sustainability Bond #2 of the State of North Rhine-Westphalia

The State of NRW sucessfully issued its second Sustainability Bond in March 2016. The bond is designed for investors focusing on Socially Responsible Investments (SRI).

Rechte: iStock

Sustainability Bond #1 of the State of North Rhine-Westphalia

In December 2014 the government of the State of North Rhine-Westphalia decided to issue its first State Treasury Note in a “Sustainability Bond” format in 2015. The concept itself and the selected projects have been audited by oekom research, a leading rating agency for Sustainability Bonds and Green Bonds. The overall evaluation of the audit was positive.

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