EIB issues 350 mln Swiss franc green bond

LONDON Fri Jan 10, 2014 10:12am EST

LONDON Jan 10 (Reuters) - The European Investment Bank (EIB) issued a 350 million Swiss franc ($384 million) "green bond" this week, after selling a record number of such bonds last year, the bank said.

Proceeds from green bonds are aimed at projects to cut greenhouse gas emissions, adapt to climate change or expand the use of renewable energy. Last year, corporate green bond deals raised nearly $10 billion.

The EIB's so-called Climate Awareness Bond (CAB) has a final maturity date of Feb. 4, 2025, and carries an annual coupon of 1.625 percent, the EIB said in a statement on Friday.

"Climate Awareness Bonds raise funds from fixed income investors to support the bank's lending to renewable energy and energy efficiency projects," it said.

The bank issued its first CAB in 2007. Since then, the bonds have raised 3.4 billion euros for the bank's projects. Last year, the bank raised its largest amount ever from CABs - 1.4 billion euros.

"Following a record year for Climate Awareness Bond issuance, this first CAB of 2014 underscores the EIB's continued commitment to the green bond market," said Bertrand de Mazières, director general of finance at the bank.

Lead managers for the transaction were Barclays, Credit Suisse and Deutsche Bank.

Until recently, green bonds were mainly the preserve of development banks, but interest in them has been growing among new buyers and corporate bond investors.

A spate of corporate green bond deals last November doubled the total raised in 2013 to nearly $10 billion, fuelling expectations that more would follow.

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