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UPDATE 1-Germany hires banks for 30-year green bond sale - lead managers

05/10/2021 09:17
UPDATE 1-Germany hires banks for 30-year green bond sale - lead managers

Adds details, context

By Yoruk Bahceli

- Germany hired a syndicate of banks on Monday to sell a 30-year green bond that will extend its yield curve of bonds backing environmentally-friendly spending, according to memos from three lead managers seen by Reuters.

The bond will be launched "in the near future, subject to market conditions," the memos said, a phrase debt management offices usually use a day before the sale.

The 30-year bond, the first such sale this year, will extend Germany's green yield curve following the issuance of an inaugural 10-year green bond last September and a five-year green bond in November. nL8N2FZ1JL nS8N2HB00E

Unlike other European governments that have focused on a single maturity for green issuance, Germany is building a yield curve of green bonds, which investors hope will act as a reference point for other borrowers in the region.

The bond, due Aug. 15 2050, will be twinned with Germany's outstanding conventional bond with the same maturity. All German green bonds are twinned with a conventional peer, allowing investors to switch between the two and mitigating any liquidity concerns.

Germany hired BofA, BNP Paribas, Citi, Commerzbank, DZ Bank and HSBC for the sale, the memos said.

Germany issued 11.5 billion euros of green bonds last year and expects to issue a similar amount this year, according to its finance agency.

In addition to the 30-year bond, for which a size has not yet been announced, Germany will issue a new 10-year green bond via auction in September and re-open it in October to raise a total of 6 billion euros.


(Reporting by Yoruk Bahceli; editing by Dhara Ranasinghe and Toby Chopra)

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