Singapore has commenced its green bond sale to generate up to $2.8 billion by reopening an existing 50-year debut note that was initially issued last year. This initiative is geared towards bolstering the country's efforts to address climate change.

The nation has decided to increase the size of the bond sale from its original target of at least $1.8 billion to potentially raising $2.75 billion through an institutional placement and an additional $50 million through a public offering.

The sale is being facilitated by the Monetary Authority of Singapore (MAS), acting as a government agent. The preliminary pricing indication for the transaction hovered around 3.15%.

This move highlights the trend among borrowers to secure funding for projects that have positive environmental impacts and contribute to sustainable development. Singapore is now following in the footsteps of Hong Kong, Germany, Italy, and other nations in issuing green bonds in 2023.

According to data compiled by Bloomberg, this collective action has driven the global issuance of green bonds by governments and corporations to exceed $344 billion ($465.5 billion), representing an 18% increase from the previous year.

Singapore's upcoming offering aims to reach a minimum of $2.3 billion and is aligned with its commitment, declared the previous year, to secure up to $35 billion in financing dedicated to environmental initiatives by 2030.

The proceeds from this endeavour will be channelled into funding projects that support the Singapore Green Plan 2030. Among these projects is the development of two new routes within the electric rail network, according to a statement posted on the MAS website on August 21.

To facilitate the institutional placement, MAS has enlisted the expertise of Citigroup Inc., DBS Bank Ltd., Oversea-Chinese Banking Corp. (OCBC), Standard Chartered Plc, and United Overseas Bank Ltd. (UOB). DBS, OCBC, and UOB are also participating banks in the public offering.

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Source: Bloomberg