World Bank green bonds to be offered to Merrill Lynch clients

Bonds to aid low carbon will be marketed over Merrill’s Global Wealth Management platform

Bank of America Merrill Lynch and the World Bank’s International Bank for Reconstruction and Development have announced a plan to offer World Bank green bonds to Merrill Lynch Wealth Management investors.

Bank of America Merrill Lynch, the global banking and markets arm of Bank of America, is arranging the offering and distributing through the Merrill Lynch Global Wealth Management platform.

The AAA-rated bonds – which will mature on May 24 2021 – support the World Bank’s financing for low carbon projects such as alternative energy, greenhouse gas reduction plans, reforestation, watershed management and flood protection.

“We’re delighted to work with BofA Merrill Lynch to make this opportunity to help finance activities that promote low carbon development in emerging economies available to their clients,” said Doris Herrera-Pol, Director and Global Head of Capital Markets at the World Bank.“As a firm, we pride ourselves on being an environmental leader in the financial services sector,” said Alastair Borthwick, co-Head of Global Capital Markets at BofA Merrill Lynch.

Since the inaugural issue in 2008, the World Bank has issued more than $2bn in green bonds in 37 transactions and 15 currencies. The first issue was a Swedish krona-denominated bond bought by Swedish investors AP2, AP3, Länsförsäkringar Bank & Försäkring and Skandia Life as well as the United Nations Joint Staff Pension Fund.

The OECD, the Organisation for Economic Cooperation and Development recently said there is enormous scope for further green bond issuance – given that they represent just 0.012% of the $91trn global
bond market.

And just this week, RI reported that investors will shortly be able to check whether so-called green bonds support agreed CO2 reduction targets when the first Climate Bonds certificate is launched.