Moody’s: Sustainable bond issuance soars to $650bn in 2021

11 Feb, 2021 01:37
source: Singularity Financial

Moody’s predicts sustainable bond volumes, encompassing global issuance of green, social and sustainability bonds, to exceed $650 billion in 2021, representing year-over-year growth of 32% from the record $491 billion set in 2020, according to a new report in early February, outlining its outlook for the sustainable finance market.

By category, Moody’s anticipated green bonds will continue to dominate sustainable bond volumes, with forecast issuance of $375 billion, up 39% year-over-year, resuming its impressive growth rate after a COVID-19 impacted flat 2020. Green bond volumes suffered in early 2020 as the pandemic struck, with growth returning as the year progressed.

Growth in social bonds is expected to moderate to mid-single digit levels, reaching $150 billion in 2021, after an explosive 2020 which saw seven-fold growth  in the category, as issuers began raising funds to respond to the COVID-19 pandemic and to finance recovery efforts.

Sustainability bonds, whose funds are used to finance a combination of eligible green and social projects, are expected to be the fastest growing category, increasing 58% to $125 billion, after doubling in 2020.