First Issuance Of Green Bonds By The French State

Author:Mr Florent Bouyer, Linda A. Hesse and Robert F. Mayo
Profession:Jones Day

On 24 January 2017, France issued its first sovereign green bonds for an amount of €7 billion, with a maturity of 22 years and a yield at issue of 1.741 percent. The French sovereign issuance was fully allocated with total bids for more than €23 billion at midday on the day of issuance. Over the last three years, there has been a growing demand for green bonds from all types of issuers (financial institutions including commercial and development banks, both large and small companies, sovereign and sub-sovereign). 

The French issuance followed the Green Bonds Principles ("GBP"), developed by the International Capital Markets Association in their current version dated 16 June 2016. These are the mostly commonly adopted rules by issuers, and they are typically accompanied by an analysis from an environmental third-party auditor. Pursuant to the GBP, a bond is considered "green" if: (i) the issuance proceeds are used solely to finance projects that have a positive environmental...

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