PFC issues India’s first-ever Euro Green Bond

What is the News?

Power Finance Corporation Ltd (PFC), the leading NBFC in the power sector, has issued its maiden Euro Green Bond.

What is a Euro Green Bond?

It is the first-ever Euro denominated Green bond issuance from India.

Moreover, it is the first-ever Euro issuance by an Indian NBFC and the first Euro bond issuance from India since 2017.

The issuance saw strong participation from institutional investors across Asia and Europe with participation from across 82 accounts and was oversubscribed 2.65 times.

What is Green Bond?

A green bond is like any other bond where a debt instrument is issued by an issuer for raising funds from investors. However, what differentiates a Green bond from other bonds is that the proceeds of a Green Bond offering are ‘ear-marked’ for use towards financing ‘green’ projects.

The Green Bonds may come with tax incentives such as tax exemptions and tax credits to attract investors. 

The World Bank is a major issuer of green bonds. It has issued 164 such bonds since 2008, worth a combined $14.4 billion.

In India, YES Bank was the first bank to issue green bonds in 2015 for financing renewable and clean energy projects.

Ghaziabad Municipal Corporation, a civic body in Uttar Pradesh, has become India’s first municipal corporation to successfully list the country’s first green municipal bonds on the Bombay Stock Exchange (BSE) in April 2021.

Source: This post is based on the article “PFC issues India’s first-ever Euro Green Bond” published in PIB on 16th September 2021.