BIS launches Asian Green Bond Fund

Press release  | 
25 February 2022
  • BIS launches Asia focused green bond fund to help channel central bank reserves to green projects in the region
  • The addition of a third BIS green bond fund means the BIS will manage some $3.5 billion in green bonds for the central banking community
  • Collaboration with the development financing community is a key feature of the new fund

The Bank for International Settlements (BIS) today launched a new green bond fund dedicated to help finance investments in green projects in the Asia and Pacific region.

The Asian Green Bond Fund joins two other green bond funds issued by the BIS since 2019. Together, the funds will manage some $3.5 billion in green bonds for central banks and other official sector investors, with the expectation that the funds will continue to grow as reserve managers' sustainable investment practices

The new fund offers central banks, both in Asia and beyond, opportunities to invest in high-quality bonds issued by sovereigns, international financial institutions, and corporates that comply with strict international green standards. These bonds help finance environmentally friendly projects in areas such as renewable energy production and energy efficiency in the Asia and Pacific region.

The BIS Asian Green Fund is a US dollar-denominated, open-ended fund and was developed under the guidance of the BIS Asian Consultative Council and in close collaboration with the Asian Development Bank, the broader development financing community and other stakeholders.

The Asian Green Bond Fund is a strong and welcome addition to the two existing green bonds funds at the BIS. Coming on the heels of COP26, it demonstrates once again the steadfast commitment of the BIS to provide a much needed and secure vehicle for global central banks in their efforts to support environmentally friendly investments.

Peter Zoellner, Head of the BIS Banking Department

Partnership is key in our combat against climate change, particularly in a region as vulnerable to climate change as Asia. The BIS can play a role as catalyst in bringing the central banking and development communities together in support of our global effort. Asia is the right place to start this collaboration.

Siddharth Tiwari, Chief Representative of the BIS for Asia and the Pacific region

As the Climate Finance Bank of Asia and the Pacific, we welcome the launch of the BIS Asian Green Bond Fund to help channel financing for investments in critical areas such as renewable energy production and energy efficiency.

Bruno Carrasco, Director General of the Asian Development Bank's Sustainable Development and Climate Change Department

BIS green bond funds belong to the BIS Investment Pool (BISIP) family, a format commonly used by BIS Asset Management for its fixed income investment products. They are managed in-house by BIS Asset Management. Bonds eligible for the new Asian green bond fund have a minimum average rating of A- and comply with the International Capital Market Association's Green Bond Principles and/or the Climate Bond Standard published by the Climate Bonds Initiative.

The fund will undergo annual reviews to ensure that it continues to be reflective of the shifting green finance landscape.

As in the case of the other two green bond funds, the BIS will produce a dedicated annual impact report for investors.