Amundi and the European Investment Bank (EIB) have joined forces for an initiative that aims to foster the development of a European green debt market beyond investment grade green bonds.
The Green Credit Continuum programme, as it has been called, will involve the creation of a fund investing in high-yield corporate green bonds, green private debt and green securitised credit.
A scientific committee composed of climate finance experts will be formed to define and promote guidelines for the three markets, and a network will be put in place to source deals and projects.
The guidelines are to be “in line with international best practice and legislation derived from the European Commission action plan on financing sustainable growth”, according to a joint statement.
The goal is to create several funds based on this model. The EIB is to make an initial commitment of up to €60m, with the aim being for €1bn to be raised within three years.
“Over the last few years the European green financing market has mainly developed by way of green bond issuances from sovereign, quasi-sovereign and large corporate issuers,” said Amundi and the EIB in the statement.
“To finance additional efforts to promote European energy and ecological transition goals, new market instruments are needed that enable smaller companies and green projects to access market financing, as well as offer higher yields to investors.”
EIB vice-president Ambroise Fayolle said the partnership would “help promote sustainable finance in Europe by including new issuers in the green finance market, making them even more aware of environmental issues and environmentally friendly investments”.
Amundi’s agreement with the EIB follows its joint venture with the International Finance Corporation, the private sector arm of the World Bank Group, to develop green finance in emerging markets. The initiative includes a green bond fund in which several major European pension funds are invested.