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Bank of America Merrill Lynch is top green bonds underwriter in Q2 2015

Top 10 green bond deals in Q2 2015. Source: Climate Bonds Initiative.

SeeNews Renewables is following the development of the green bond market. Today we are publishing pieces of the Climate Bonds Initiative's (CBI) green bond underwriters overview for the second quarter (Q2) of 2015, originally published here.

August 4 (SeeNews) - The green bond market stepped up a gear in Q2 with USD 11.9 billion (EUR 10.9bn) of deals, up from USD 7.1 billion in Q1. Behind this resurgence of issuance are the underwriter banks that arrange and facilitate the green deals.

THE TOP GREEN BOND UNDERWRITERS

Top of the table in this busy Q2 is Bank of America Merrill Lynch (BAML), underwriting just over USD 2 billion green bonds in the quarter. It’s not the first time BAML takes one of the leading green bond underwriter spots: last quarter the Bank was the third biggest green bond underwriter, and for 2014 as a whole it came in second.

BAML’s top spot come from underwriting a range of green bond corporate deals, varying from UK’s Transport for London to Brazil’s first green bond from food company BRF SA. In the US market, it was involved in Digital Realty’s corporate green bond and Toyota Finance’s second asset-backed green bond. And BAML wasn’t just busy on underwriting other banks’ bonds: in Q2, it also issued its own second green bond. Great to see BAML setting the bar for other underwriters!

Hot on the heels of BAML is Credit Agricole CIB (CA CIB), coming in as the second biggest green bond underwriter in Q2 2015. European green bond deals that CA-CIB were involved in include the trailblasing Berlin Hyp covered bond and Climate Bonds-certified green bond from ABN AMRO. CA-CIB were also active in underwriting green bonds from a variety of development banks, including EBRD, World Bank, Asian Development Bank and Nordic Investment Bank and Swedish Export Credit (SEK).

Citi Bank came in third for the quarter, having been involved in the Digital Realty and BRF green bonds in Q2. Amongst its other underwriting, Citi was involved in both of the ABS deals in the quarter; Renewfund and Toyota.

In fourth place was SEB, the green bond king of the Nordics. The bank was involved in almost all of the green bond deals in the region during Q2 including municipal green bonds from Stockholms Lands Landsting and the City of Gothenburg. SEB was also the underwriter for the first Latvian green bond from Latvenergo.

Following SEB in the rankings is Morgan Stanley, driven by its involvement in the Terraform Power Operating and BRF green bonds, as well as being the sole underwriter of Virginia State College’s green bond.  Like BAML, Morgan Stanley also issued their own green bond in Q2, which they also underwrote.

New in the top 20 list of underwriters are Australia and New Zealand Banking Group (ANZ Bank) and ABN AMRO following the successes of their respective Climate Bonds certified green bonds. 

TOP 10 GREEN BOND DEALS IN Q2

Toyota Finance’s second issuance of green asset-backed securities snagged the top spot as largest deal of the quarter, underwritten by Bank of America Merrill Lynch, Citi and Credit Agricole CIB.

The second largest green bond deal of the quarter was issued by TenneT Holding and underwritten by other top 20 underwriters: HSBC, Lloyds, ING, RBS and Rabobank. The transmission system operator (TSO) issued a EUR-1-billion bond to finance over 2.6 GW of offshore wind transmission capacity in German waters.

The European Investment Bank's (EIB) sterling green issuance was the third biggest at GBP 500 million with Barclays, Citi, HSBC, JP Morgan, RBC and Standard Chartered joint underwriting the deal.

(USD 1 = EUR 0.914)

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Sean Kidney is CEO of the Climate Bonds Initiative, an investor-focused NGO working to mobilise debt capital markets for climate solutions. Projects include a green bond definitions and certification scheme, and work with the Chinese Government on how to grow green bonds in China.

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