Sustainability-linked Bond Principles to support a new type of COVID bonds

Geography: All Regions
Sector: Banking & Finance

Read More: Sustainability-linked COVID bonds

COVID bonds will play an important role in financing COVID-19 stimulus measures. All issues to date have been either general purpose bonds or use of proceeds bonds. However, a third type, performance-based bonds, has a lot of potential to address the needs of issuers. In case of COVID related sustainability linked bonds, the coupon would be linked to health KPIs. The good news is that the International Capital Market Association (ICMA) has just launched its Sustainability-linked Bond Principles to finally provide some guidelines for this increasingly popular financing instrument. For more details on the launch, please check out this Environmental Finance article.