MuniFin – Green Bonds
MuniFin Green Bonds are used to finance green investments in the Finnish municipal and affordable social housing sector. They promote the achievement of Finland’s climate targets by offering green finance for climate and environmentally friendly investments.
Purpose
MuniFin Green Bonds are used to finance green investments in the Finnish municipal and affordable social housing sector. They promote the achievement of Finland’s climate targets by offering green finance for climate and environmentally friendy investments. The funding is sourced from international capital markets.
MuniFin’s Green finance can be granted for projects that belong to one of the categories of MuniFin’s Green Bonds Framework and has verifiable positive impacts on the environment. The final assessment of the project’s suitability for the green finance portfolio is made by MuniFin’s Green Finance Team.
Results
Green finance accelerates Finnish environmental projects and furthers their ambition. An incentive for this is the margin discount granted for the projects approved in the green finance portfolio. The magnitude of the discount depends on the extent of a project’s climate impact.
To make climate and environmentally friendly investments more attractive to our customers, we grant approved green finance projects a margin discount of 0–10 basis points. The discount is based on the project’s estimated environmental benefits, which are assessed and scored by the Green Finance Team. The greener the project, the bigger the discount.
Implementation
MuniFin is the most active Finnish bond issuer in the international capital market, and also the first-ever Finnish issuer of green bonds. The popularity of green bonds has grown rapidly in the market, as investors are looking for responsible investments. The green bonds issued by MuniFin have also been highly sought after among investors. At the end of December 2022, MuniFin’s green portfolio amounted to EUR 3.3 billion euro. Total amount of outstanding green bonds were EUR 2.33 billion.
MuniFin’s green finance has steadily grown over the years but a lot is still to be done. As a trailblazer of sustainable finance, we want to make the benefits of environmental investments more visible and do our part in creating a sustainable world together with our customers.
Financing is always one of the major issues when building environmental solutions. With new financing instruments that take the larger impacts of a solution to account, making an impact becomes slightly easier. There are different solutions for these kinds of funding mechanisms available, but all of them are needed and very welcome.
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