In line with the global trends, we saw record growth in new sustainable bond issuance in 2020, a term that encompasses the three categories green, social and sustainability bonds. With EUR 186 billion worth of new issuance, the combined value of new sustainable bonds included on LGX in the 12-month period grew by 134% compared to 2019. In terms of the number of new sustainable securities, 2020 saw a 51% increase compared to the previous year. While there was notable growth across the green, social and sustainability bond categories, the steep rise of social bond issuance is what really marked the year of the COVID-19 pandemic, both at LGX and in international capital markets. For the first time since its inception, the value of social and sustainability bonds combined surpassed the total value of green bonds displayed on LGX in 2020.
An array of new issuers
In 2020, we welcomed 36 new issuers
to LGX. Together, these new issuers brought 63 new sustainable bonds totalling more than EUR 65 billion
. In total, new and existing issuers displayed 407 new sustainable securities on LGX in 2020.
We saw great diversity in the type of issuers joining LGX last year, covering sovereigns, development banks, financial institutions and corporates. In terms of new corporate issuers, they represent an array of sectors and industries including insurance companies, banks, utilities, automotive companies, real estate developers, tech companies, consumer goods and luxury brands.
2020 was a year of firsts:
- NORD/LB issued the first green covered bond under Luxembourg law. The EUR 300 million bond is the world's first renewable energy covered bond with an exclusively green cover pool.
- The Grand Duchy of Luxembourg issued Europe’s first sovereign sustainability bond. This EUR 1.5 billion bond raised financing for electric public transportation and hospitals in Luxembourg.
- The European Commission issued its very first social bond, under the EU SURE programme. The initial EUR 17 billion social bond protects jobs and workers across Europe, heavily impacted by the COVID-19 pandemic.
- Symbiotics, a market access platform for impact investing, issued a total of 7 green and social bonds - as well as its very first sustainability bond - totalling EUR 46 million last year to finance micro, small and medium enterprises and low-income households in emerging markets.
The S of ESG
When the COVID-19 pandemic started to spread across the world in March, the Social dimension was brought to the fore. We saw an immediate uptick in social and sustainability bond issuances addressing the devastating social and economic fallout from the crisis. In 2020, we welcomed EUR 17 billion worth of COVID-19 response bonds issued according to international standards for social or sustainability bonds on LGX. Issuers leading the way were development banks such as the World Bank, the International Finance Corporation, the European Investment Bank, the African Development Bank, the Council of Europe Development bank, Instituto de Crédito Official
and Cassa Depositi e Prestiti
. There were also corporate issuers that turned to capital markets and LGX to raise financing in response to the unprecedented situation caused by the pandemic, such as Mitsubishi