Qatar Issues USD 2.5 Billion Green Bonds

Qatar Issues USD 2.5 Billion Green Bonds By A Robin - May 26, 2024
Green Bonds

Green Bonds

The Ministry of Finance announced the issuance of green bonds totaling USD 2.5 billion, marking the first issuance of its kind in the region, aimed at funding environmentally friendly projects.

The ministry said that the bonds are divided into two tranches: a USD 1 billion tranche with a five-year maturity priced at a 30 basis point spread over US Treasuries and a USD 1.5 billion tranche with a 10-year maturity priced at a 40 basis point spread over US Treasuries.

Qatar achieved the lowest spread ever recorded by any bond-issuing country in the Middle East, Central and Eastern Europe, and Africa.

The Ministry of Finance revealed that the coverage ratio exceeded 5.6 times the total issuance size, with peak subscription demand reaching over USD 14 billion. This confirms that the issuance enjoyed broad and diversified geographic and institutional investor interest from around the world.

The remarkable success of the subscription process reflects investors' high confidence in the sovereign green financing framework established by the Ministry of Finance according to the highest global standards in sustainable finance. It also provides investors with an opportunity to participate in the country's journey to combat the negative effects of climate change and protect the environment through sustainable development, alongside the development of the sustainable finance sector in the country.

Credit Agricole and HSBC were selected as coordinators for structuring the sovereign green financing framework and will serve as global coordinators alongside JP Morgan and QNB Capital as primary issuance managers. They will also be joint bookrunners with Barclays, Citigroup, Deutsche Bank, Goldman Sachs, SMBC Nikko, and Standard Chartered bank.

Qatar has significantly improved its sovereign credit ratings to elite levels. Fitch Ratings upgraded Qatar's rating from AA- to AA with a stable outlook, which is the third-highest sovereign credit rating globally. Moody's also upgraded Qatar's rating to AA2 and changed its outlook to stable.


By A Robin - May 26, 2024

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