Ile-de-France, a French regional authority, has committed to finance projects that are exemplary from a social responsibility and environmental standpoint through funds raised with bonds. This is the first time that sustainable bonds have been issued with public placement in the euro market.

The bonds were launched on 20 March with Crédit Agricole CIB and BNP Paribas as lead arrangers. The size of the transaction is 350 million euros, the largest issued by a French regional authority. The funds will be used to finance environmental investment projects (50%) in particular on energy and biodiversity; and to fund social and solidarity-based economic development initiatives (50%) focusing on housing but also on the protection of the most disadvantaged.

For more information, please visit the Crédit Agricole CIB website.

This move has attracted a lot of interest from investors. Having public authorities issue this type of bond is also very likely to contribute to the development of the market for sustainable bonds.

Moreover, this type of sustainable bond issuance seems to go one step closer to a concept that originated within the London Accord community - index-linked carbon bonds - whereby government bond issuance is tied to their performance against environmental commitments whether on greenhouse gas emissions, renewable energy developments or any other public policy commitment to a low-carbon future. Read more...