New comer in international institutional finance- the New Development Bank supported by BRICS bank targets to issue green bonds worth $3 bn to finance infrastructure projects. The bank is equally sponsored by five BRICS countries and is headquartered in Shanghai.
Green bonds are issued to mobilize funds for financing environment friendly projects.
The bonds will be issued from July and is for five years. projects including clean energy, and infrastructure are expected to be supported from funds mobilized through the bonds.
Interestingly, the bonds will be yuan denominated which implies domestic fund raising or implicit internationalization of the Chinese currency.
Large sized Chinese financial institutions will be participating in the issue of green bonds. China Development Bank, China Construction Bank, Industrial and Commercial Bank of China, HSBC and Standard Chartered Bank are underwriters of the issue.
The NDB which has less limelight compared to the more Chinese controlled AIIB, has sanctioned funds for several green projects since its inception in 2015.
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