Into the green

At the cusp of 2021, recently-approved Covid-19 vaccines offered a light at the end of the tunnel. For many, the tunnel sadly proved longer than hoped. But as we enter the second half of the year, there are encouraging signs that the worst societal and economic effects of the pandemic may be easing.

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For many of us who have been working from homes connected only virtually to the world of work, this heralds a gradual return back out into the wider world. In parallel, Bank+Insurance Hybrid Capital is returning in print for the first time since the onset of the pandemic — we hope you have in the meantime found our timely online BIHC Briefings valuable.

As we tentatively emerge into the light, there is a widespread feeling that the post-pandemic world can and should be different: better, fairer, greener.

Fortunately, the financial sector was in ways primed for such an evolution through the growing emphasis on ESG factors ahead of the crisis, not least in the development of green, social and sustainability bonds in the capital markets.

And 2021 has seen a surge in the proportion of issuance in these formats, not least as senior non-preferred and Tier 2 bonds. In this edition, we look at the latest developments in this field and hear from issuers who are embracing these trends, such as BayernLB and Raiffeisen Bank International.

Our partner Crédit Agricole CIB continues to be at the heart of ESG-related innovations such as sustainability-linked bonds, and global head of financing and funding solutions Arnaud D’Intignano shares his insights into how the wider market and the corporate and investment bank are positioned for the second half of the year.

The recovery from the pandemic will see significant fiscal and monetary support programmes falling away in the coming months. Representatives of CACIB’s syndicate, DCM solutions, and economics teams discuss the potential timing and impact of any such moves on either side of the Atlantic, and the likely impact on rates and spreads.

However the remainder of the year plays out, it is safe to say, the world will never be the same again.

Neil Day,
Managing Editor, Bank+Insurance Hybrid Capital