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Green Bonds

Chile is strongly committed to climate action, environmental protection and sustainable growth. Reflecting this commitment, Chile is the first country in the Americas to issue Green Bonds. Green Bonds are a tool to channel investments towards green assets, contributing to further financial development and promoting national financial innovation that supports the country’s sustainable development path, low in carbon emissions, with strong climate resilience.

According to international best practice, Chile’s Green Bonds were structured in accordance with Chile’s Green Bond Framework. This document was prepared by the Ministry of Finance in coordination with other sectorial ministries and the support of the Inter-American Development Bank. The USD 4.4 billion project portfolio for the 2019 green bond issuances was selected in eligible projects from several categories: Clean Transportation, Renewable Energy, Water Management, and Green Buildings.

The 2019 issuances, in USD and Euros, totalled USD 1,418 million and EUR 861 million (USD 947 million equivalent), respectively.

Among the main features of these transactions, the following stand out:

  • Lowest yields obtained ever in primary issuances in both currencies at the respective maturity (3.53% for the USD and 0.83% for EUR bonds) and low spreads
  • Record demand from global markets (12.8 times the amount offered for USD bonds, and 4.7 times for the EUR bonds), and an important widening of Chile’s investor base towards institutional investors with green mandates
  • First Green Bonds in the Americas and the first Sovereign Green Bond issuance in Euros issued by a non-European sovereign. USD Bond was the longest tenor debut green bond 

 

 

More information at:

https://www.hacienda.cl/english/press-room/news/archive/ministry-of-finance-receives-favourable.html

Frequently Asked Questions on Green Bonds:

https://www.hacienda.cl/english/public-debt-office/frequently-asked-questions/green-bonds.html

 

Green Bonds Documentation:

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