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This paper aims to provide guidance to issuers of sovereign ESG bonds, with a focus on Emerging Market and Developing Economies (EMDEs). An overview of the ESG financing options available to sovereign issuers is followed by an analysis of the operational requirements and costs that the issuance of sovereign ESG bonds entails. While green bonds are the instruments used to describe the issuance process, the paper also covers alternative instruments, including social and sustainability-linked bonds to provide issuers and other stakeholders with a comprehensive view of the ESG bond marketplace.
Macroeconomics --- Economics: General --- Investments: Bonds --- Environmental Economics --- Corporate Governance --- Public Finance --- General Financial Markets: General (includes Measurement and Data) --- Financial Institutions and Services: General --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- Financial Institutions and Services: Government Policy and Regulation --- Corporate Finance and Governance: Government Policy and Regulation --- Taxation, Subsidies, and Revenues: Other Sources of Revenue --- National Government Expenditures and Related Policies: General --- Debt --- Debt Management --- Sovereign Debt --- Agricultural and Natural Resource Economics --- Environmental and Ecological Economics: General --- Energy: Government Policy --- Climate --- Natural Disasters and Their Management --- Global Warming --- Ecological Economics: Ecosystem Services --- Biodiversity Conservation --- Bioeconomics --- Industrial Ecology --- Environmental Economics: Government Policy --- Environmental Economics: General --- Corporate Culture --- Diversity --- Social Responsibility --- Economic & financial crises & disasters --- Economics of specific sectors --- Investment & securities --- Corporate governance --- role & responsibilities of boards & directors --- Green finance / sustainable finance --- Environmental economics --- Public finance & taxation --- Bonds --- Financial institutions --- Corporate social responsibility --- Economic sectors --- Climate finance --- Environment --- Sovereign bonds --- Currency crises --- Informal sector --- Economics --- Climatic changes --- Environmental sciences --- Debts, Public --- Colombia
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This paper analyzes the effects of including collective action clauses (CACs) and enhanced CACs in international (nondomestic law-governed) sovereign bonds on sovereigns’ borrowing costs, using secondary-market bond yield spreads. Our findings indicate that inclusion of enhanced CACs, introduced in August 2014, is associated with lower borrowing costs for both noninvestment-grade and investment-grade issuers. These results suggest that market participants do not associate the use of CACs and enhanced CACs with borrowers’ moral hazard, but instead consider their implied benefits of an orderly and efficient debt resolution process in case of restructuring.
Banks and Banking --- Financial Risk Management --- Investments: Bonds --- Interest Rates: Determination, Term Structure, and Effects --- Current Account Adjustment --- Short-term Capital Movements --- International Lending and Debt Problems --- General Financial Markets: General (includes Measurement and Data) --- Financial Crises --- Investment & securities --- Finance --- Economic & financial crises & disasters --- Sovereign bonds --- Bond yields --- Bonds --- Yield curve --- Financial crises --- Interest rates --- Greece
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This paper aims to provide guidance to issuers of sovereign ESG bonds, with a focus on Emerging Market and Developing Economies (EMDEs). An overview of the ESG financing options available to sovereign issuers is followed by an analysis of the operational requirements and costs that the issuance of sovereign ESG bonds entails. While green bonds are the instruments used to describe the issuance process, the paper also covers alternative instruments, including social and sustainability-linked bonds to provide issuers and other stakeholders with a comprehensive view of the ESG bond marketplace.
Colombia --- Macroeconomics --- Economics: General --- Investments: Bonds --- Environmental Economics --- Corporate Governance --- Public Finance --- General Financial Markets: General (includes Measurement and Data) --- Financial Institutions and Services: General --- Pension Funds --- Non-bank Financial Institutions --- Financial Instruments --- Institutional Investors --- Financial Institutions and Services: Government Policy and Regulation --- Corporate Finance and Governance: Government Policy and Regulation --- Taxation, Subsidies, and Revenues: Other Sources of Revenue --- National Government Expenditures and Related Policies: General --- Debt --- Debt Management --- Sovereign Debt --- Agricultural and Natural Resource Economics --- Environmental and Ecological Economics: General --- Energy: Government Policy --- Climate --- Natural Disasters and Their Management --- Global Warming --- Ecological Economics: Ecosystem Services --- Biodiversity Conservation --- Bioeconomics --- Industrial Ecology --- Environmental Economics: Government Policy --- Environmental Economics: General --- Corporate Culture --- Diversity --- Social Responsibility --- Economic & financial crises & disasters --- Economics of specific sectors --- Investment & securities --- Corporate governance --- role & responsibilities of boards & directors --- Green finance / sustainable finance --- Environmental economics --- Public finance & taxation --- Bonds --- Financial institutions --- Corporate social responsibility --- Economic sectors --- Climate finance --- Environment --- Sovereign bonds --- Currency crises --- Informal sector --- Economics --- Climatic changes --- Environmental sciences --- Debts, Public --- Role & responsibilities of boards & directors
Choose an application
This paper analyzes the effects of including collective action clauses (CACs) and enhanced CACs in international (nondomestic law-governed) sovereign bonds on sovereigns’ borrowing costs, using secondary-market bond yield spreads. Our findings indicate that inclusion of enhanced CACs, introduced in August 2014, is associated with lower borrowing costs for both noninvestment-grade and investment-grade issuers. These results suggest that market participants do not associate the use of CACs and enhanced CACs with borrowers’ moral hazard, but instead consider their implied benefits of an orderly and efficient debt resolution process in case of restructuring.
Greece --- Banks and Banking --- Financial Risk Management --- Investments: Bonds --- Interest Rates: Determination, Term Structure, and Effects --- Current Account Adjustment --- Short-term Capital Movements --- International Lending and Debt Problems --- General Financial Markets: General (includes Measurement and Data) --- Financial Crises --- Investment & securities --- Finance --- Economic & financial crises & disasters --- Sovereign bonds --- Bond yields --- Bonds --- Yield curve --- Financial crises --- Interest rates
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