HSBC and IFC Raise $538m for Final Close of EM Green Bond Fund

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Mar 2021
Global, March, 18 2021 - The climate-focused green bond fund, which is known as REGIO, has reached a final close with total investor commitments of $538m after two European investors increased allocations to the fund.

HSBC Asset Management and IFC, which is part the World Bank Group, have announced the final close of the HSBC Real Economy Green Investment Opportunity GEM Bond Fund.

The climate-focused green bond fund, which is known as REGIO, has reached a final close with total investor commitments of $538m after two European investors increased allocations to the fund.

PROPARCO, which is the subsidiary of Agence Française de Développement and a founding partner of the fund, further invested in the strategy. Meanwhile, the Italian National Promotional Institution, known as Cassa Depositi e Prestiti S.p.A., joined the strategy to combat climate change.

REGIO’s final close follows the fund completing its third close in May 2020, after it received $474m of new financing.

A total of 10 investors have now joined the strategy, which was launched in 2019 when both HSBC and IFC each committed $75m to the strategy as anchor investors.

Investors in the fund include, but is not limited to insurance companies Aviva France and Cardif Assurance Vie, Gothaer Asset Management, and Danish pension fund Lærernes Pension, which is an occupational pension fund for Danish Teachers.

REGIO uses both public and private capital to provide investors with a diversified vehicle to invest in individual green bond transactions, or to complement an existing EMD allocation with a green impact bond solution.

The strategy, which aims to address the demand for climate smart investment, targets markets that are most at threat from the effects of climate change and seeks to accompany these economies in their transition to a low-carbon future by further increasing access to climate finance and promoting the development of sustainable capital markets through a broader range of issuers.

HSBC AM’s chief executive officer Nicolas Moreau (pictured) said: ‘The emphasis that we need to place on helping economies transition sustainably is more significant than ever before.

‘Climate change is one of the main risks of our lifetime and for REGIO to close at this size during a global pandemic highlights how important combating it is to investors, and we are thankful to them for their support.

‘As investors we believe that investing in them today creates opportunities for tomorrow, and that by working through public and private partnerships, we can create investment solutions while simultaneously discovering ways to address global sustainability challenges.’



 

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