EIB, Amundi to launch new green debt programme for Europe's smaller players

The European Investment Bank (EIB) and Paris-based asset manager Amundi SA (EPA:AMUN) have signed an agreement to launch a new green financing programme that will enable smaller European enterprises to gain access to green debt instruments.

The EIB will commit EUR 60 million (USD 67.2m) to the programme, named the Green Credit Continuum, with the objective to raise EUR 1 billion in total within three years, the EU lender said Tuesday.

The purpose of the Green Credit Continuum programme is to expand the European green debt market to include small-scale green projects, small and medium-sized enterprises (SMEs) and mid-cap financing and offer new market instruments that go beyond the existing green bond model.

The programme will target both the supply and the demand side of the green finance market. With the access to market financing, European companies will be able to expedite their energy transition. In exchange, green-minded institutional investors can expect higher yields in Europe’s low-interest rate environment.

The EIB-Amundi agreement has three components starting with the creation of a diversified fund that will invest in green high yield corporate bonds, green private debt and green securitised debt. The fund will be accompanied by a committee of green finance experts with a role to define and promote environmental guidelines for these markets. Finally, a green deal network will be established to source deals and projects.

According to the EIB, if Europe intends to meet its Paris Agreement targets, it will require an additional EUR 180 billion in financing a year until 2030.

(EUR 1.0 = USD 1.12)

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