Germany Announces Green Federal Securities for 2020

On August 24, 2020, the German Government announced the launch of its first Green German Federal Securities in the second half of 2020. Up to EUR 11 billion is expected to be issued through these financing instruments in the coming months. Dr. Jörg Kukies, State Secretary at the Federal Ministry of Finance, explained:

“From now on, the German Government will issue green federal bonds every year. In this way, we are creating strong momentum towards a more robust sustainable finance market. Our innovative ‘twin bond’ approach is designed to attract new investors and issuers to the green bond market and thus act as a catalyst, channelling more investments into a greener economy.”

The new green securities will always be issued with the same characteristics as conventional federal securities, establishing twin bonds with identical maturity and coupon. The securities will be assigned to expenditures in the preceding budget year, for instance from sectors such as transport, research, and energy.