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☆ Morgan Stanley says these stocks are making improvements on ESG that can also boost returns
▼ + stars: | 2023-02-19 | by ( Alex Harring | ) www.cnbc.com time to read: +4 min

Morgan Stanley honed in on publicly traded companies that are improving on ESG in ways that can boost shareholder returns. "We think ESG rate of change will be a critical focus for investors looking to identify companies that can generate alpha and ESG impact," he said in a note to clients in late 2022. Though he said both approaches to ESG screens can be useful, he specifically looked for companies doing under-the-radar ESG work. Eighty-percent of analysts rate the stock a buy, FactSet data shows. Roughly two-thirds of analysts rate the stock as buy or overweight, and the average price target implies upside of nearly 15%.

☆ Japan's Nippon Steel to pay record FY dividend on rising profit
▼ + stars: | 2023-02-09 | by ( ) www.reuters.com time to read: +1 min

Feb 9 (Reuters) - Japan's top steelmaker Nippon Steel Corp (5401.T) on Thursday posted a 2% increase in April-December net profit to 517 billion yen ($4 billion) and said it would pay a record-high full-year dividend of 180 yen per share. Nippon Steel, which kept its full-year net profit forecast unchanged at 670 billion yen, paid an annual dividend of 160 yen per share last year. The company raised its full-year underlying business profit forecast by 60 billion yen to 690 billion yen, as it expects its non-consolidated steel output to be 200,000 tonnes higher than estimated in its previous forecast released in November. As Nippon Steel expands in lower-emission business including carbon capture and storage, it plans to issue a green bond on the Japanese market to co-finance production of electrical steel sheets used in eco-friendly car motors, it said. The size and maturity of the bond are yet to be announced and the issue itself may come in March or later, Nippon Steel added.

☆ ECB lays out balance sheet run-off, will further favour green firms
▼ + stars: | 2023-02-02 | by ( Yoruk Bahceli | ) www.reuters.com time to read: +3 min

The ECB is laying out details after it announced in December it would run bonds off its balance sheet at an average pace of 15 billion euros per month from March through June. The ECB will allocate proceeds remaining after the rundown proportionally to upcoming maturities across its public sector, corporate, covered bond and asset-backed security portfolios, it said in a statement. For its public sector holdings, it will reinvest in proportion to upcoming redemptions by each country and across governments versus supranational debt, the bank said. The ECB said it will also would skew remaining corporate debt reinvestments "more strongly" towards companies with a better climate performance, enhancing a process it first started in October. By raising longer-term borrowing costs, the winding-down of its bond portfolio should tighten financial conditions, making it more expensive for firms and governments to borrow.

☆ Campaigners urge bond investors to shun Adani Group on green concerns
▼ + stars: | 2023-01-30 | by ( Isla Binnie | ) www.reuters.com time to read: +2 min

NEW YORK, Jan 30 (Reuters) - An advocacy group focused on the impact of debt markets on climate change called on Monday for major bond investors to shun India's Adani Group, saying a critical report by a short-seller had undermined confidence in the company's governance. Billionaire chairman Gautam Adani, one of the world's richest people, dismissed these as baseless. Spokespeople for the Adani Group, BlackRock, Allianz and Pimco did not immediately respond to requests for comment. Green bonds, used to raise funds for specific projects that are seen to benefit the environment, are one of Adani's sources of financing. "The interconnected financial nature of the Adani Group makes it clear that buying debt from any subsidiary of Adani, is by extension supporting Adani's mining businesses," Haines said in the letter.

☆ India plans to classify clean activities, technologies under a new policy -sources
▼ + stars: | 2023-01-27 | by ( Sarita Chaganti Singh | ) www.reuters.com time to read: +2 min

NEW DELHI, Jan 27 (Reuters) - India is working on a policy to classify economic activities and technologies into sustainable and non-sustainable categories to help investors looking for green projects, three government officials say. The renewable energy ministry and the finance ministry are working on the draft policy. The officials said the draft framework is the first step in a long process of identifying sustainable projects and phasing out others. The EU also places green investment disclosure obligations on financial companies, pension funds, companies and financial market participants. Last week, India sold its first sovereign green bonds worth a total of 80 billion rupees, at yields below comparable government bonds.

☆ India's first green bond issue pulls local bidders, foreigners aloof - traders
▼ + stars: | 2023-01-25 | by ( Dharamraj Lalit Dhutia | ) www.reuters.com time to read: +2 min

MUMBAI, Jan 25 (Reuters) - India's first sovereign green bond issue was mostly subscribed by local banks and insurance companies, with limited interest from foreign investors, market participants said. New Delhi raised 80 billion rupees ($981.31 million) via green bonds on Wednesday. The five-year 7.38% 2027 bond yield was at 7.15%, while the benchmark 7.26% 2032 bond yield was at 7.35% during the time of bidding. Local banks and mutual funds do not have a specific mandate to invest in green bonds and treat these at par with other sovereign bonds. Ahead of Wednesday's auction, the government had met foreign investors to gauge the demand, Reuters had reported.

The government plans to raise 160 billion rupees through green bonds for the current fiscal ending March 31, with the first tranche of 80 billion rupees scheduled for auction on Wednesday. "The expectation of a green premium is in line with 'greenium' that issuers have got globally," said one of the two sources. "Green bonds should command a premium because of the mandates to invest in these securities. The RBI will auction 40 billion rupees each of five-year and 10-year green bonds. "It will be advisable to appoint an external auditor with an oversight by CAG (Comptroller and Auditor General) for utilisation of green bond proceeds."

MUMBAI, Jan 23 (Reuters) - The Indian rupee is expected to extend its gains this week, while government bond yields may move marginally higher due to worries about yet another year of elevated borrowing. The local unit is likely to add to its momentum and trade in a broad 80.50-81.50 range this week, analysts said. Despite the corporate flows in the market, steady foreign investment into equities is more important, so it seems appropriate for the rupee to trade around those levels, Biswas added. Market participants expect the benchmark bond yield to trade in the 7.30%-7.40% band this week. The Reserve Bank of India will auction 40 billion rupees each of five- and 10-year green bonds on Wednesday.

"It's important for us to have clear agreement because this is what we have now to finance our development," he said. President Felix Tshisekedi's government has been revisiting a 2007 deal struck by his predecessor Joseph Kabila under which Sinohydro Corp (SINOH.UL) and China Railway Group Limited agreed to build roads and hospitals in exchange for a 68% stake in the Sicomines venture as well as a 2008 contract with CMOC. "We have already a framework, we have some key elements of change that we want to bring in that agreement," Kazadi said of Sicomines, though he declined to provide further details. "In only five days they have managed to burn and export 27 kilograms," Kazadi said, speaking of the joint venture that is owned 55% by the United Arab Emirates with the remainder owned by Kinshasa. Reporting by Karin Strohecker and Jorgelina do Rosario, editing by Mark HeinrichOur Standards: The Thomson Reuters Trust Principles.

SYDNEY, Jan 3 (Reuters) - Hong Kong aims to raise up to the equivalent of $5 billion in a dollar, euro and offshore Chinese yuan green bond issuance, sources with direct knowledge of the matter said. Hong Kong's government was proposing that the dollar tranche could be spread across three-, five- and 10-year tranches, with a possibility of issuing a 30-year bond, two sources told Reuters. Hong Kong was aiming to raise about $3 billion in dollars, those two sources said. The euro tranche was targeting 1 billion euros in two- and seven-year tenors, they added. The offshore-yuan-deal was intended to be worth about 5 billion yuan and would include a longer tenor of five years, said one of the sources and two others.

Companies BlackRock Inc FollowHONG KONG/SHANGHAI, Dec 21 (Reuters) - China plans to tighten rules to regulate environmentally friendly, or so-called green funds, as part of its efforts to rein in 'greenwashing' in the world's second-largest climate fund market, sources with direct knowledge of the matter said. At present, China's green funds only operate within broad investment guidelines that came into effect in 2018 and do not have a mandatory labelling regime. China overtook the United States last year to become the second largest climate fund market globally after the European market, according to Morningstar, which compiles global ESG fund data. In the first nine months of this year, 43 climate-themed funds debuted in China, a 30% rise in total number of products from end-2020. AMAC's draft rules borrow from the 2021 version of China's green bond catalogue, a quasi scheme of classification, to define green assets.

The funds, which reflect a range of environmental, social and governance (ESG) issues, are also set to lag the performance of non-ESG funds for the first time in five years, data shows, after the fossil fuel shares they typically shun soared. "They (ESG funds) are subject to the same market movements," she added. Reuters GraphicsHowever, non-ESG funds have also suffered withdrawals, losing $420 billion in the first 11 months of 2022, the data shows. Reuters GraphicsUNDERPERFORMINGAfter several years of outperform - thanks partly to large holdings of U.S. technology stocks - ESG equity funds, which make up the bulk of assets in the sector, have fallen back to earth. ESG equity funds have lost 18% to end-November, versus a 15.8% fall in non-ego equity funds, based on Refining Lipper data.

☆ FTSE Russell, Ping An jointly launch China ESG indexes
▼ + stars: | 2022-12-08 | by ( ) www.reuters.com time to read: +3 min

SHANGHAI, Dec 8 (Reuters) - Global index publisher FTSE Russell and Chinese financial conglomerate Ping An announced a partnership on Thursday to promote sustainable investment, launching a series of China indexes integrating environmental, social and government (ESG) considerations. The FTSE Ping An China ESG Index Series, which combines Ping An's China-specific ESG approach into FTSE Russell's China indexes, shows how Chinese and western institutions can join hands in sustainable investment, despite tensions over sensitive areas such as human rights and Communist Party control. The initial index launch will target onshore investors, but the multi-year partnership aims to ultimately serve international investors as well, said FTSE Russell, a unit of London Stock Exchange Group (LSEG.L). "It's really about leveraging the market-specific insights" that Ping An brings, said Helena Fung, Head of Sustainable Investment, APAC at FTSE Russell. In China, however, internet censorship is not factored into ESG considerations by domestic institutions.

RIYADH, Dec 7 (Reuters) - Saudi Arabia expects to post a second consecutive budget surplus in 2023, though down 84% from this year as an uncertain global economic outlook and lower crude prices look set to weigh on the top oil exporter's revenues. Spending is slightly lower than 1.132 trillion riyals this year. Revenues are expected at 1.13 trillion riyals, down from 1.234 trillion riyals in 2022 as oil prices are seen falling from this year's high levels. Public debt is seen falling 3.5% to 951 billion riyals next year, or 24.6% of GDP. Government reserves at the Saudi Central Bank are estimated to reach 399 billion riyals at the end of next year, the finance ministry said.

Summary Climate change has big impact on economy, inflation - AmamiyaAug survey showed strong demand for green bonds - BOJ AmamiyaBOJ's climate scheme has extended $26 bln in loansTOKYO, Nov 27 (Reuters) - Bank of Japan (BOJ) Deputy Governor Masayoshi Amamiya said on Sunday the central bank will conduct a survey annually of financial institutions and companies, seeking ways to nurture the country's growing climate finance market. An initial survey in August showed "strong demand" in Japan for "green" bonds and other environmental, social and governance (ESG) debt instruments, Amamiya said. Some respondents said they faced challenges in obtaining information and appropriate methods for assessing risks associated with climate change, he said. "Central banks can therefore contribute to achieving macroeconomic stability in the long run by supporting private-sector moves to deal with climate change." The BOJ last year rolled out a funding scheme targeting activities aimed at combating climate change, as part of efforts to align itself with a global push toward a greener society.

☆ Canada's PSP fund to double issuance of long-term green bonds
▼ + stars: | 2022-11-10 | by ( ) www.reuters.com time to read: +1 min

TORONTO, Nov 10 (Reuters) - Canada’s Public Sector Pension Investment Board (PSP Investments) aims to more than double the C$1 billion ($749 million) value of sustainable bond issuance by 2026, an official at the pension fund told Reuters on Thursday. The pension scheme, which manages C$230.5 billion in assets, issued its first-ever green bond in February this year as part of its goal to reach net-zero emissions. Several other pensions including Ontario Teachers' Pension Plan (OTPP), Caisse de dépôt et placement du Québec and the Canada Pension Plan Investment Board (CPPIB), have also issued green bonds. Neither OTPP, CPPIB nor Caisse have set targets for green bond issuance. PSP, Canada's fifth-largest pension investment manager, also increased its exposure to green assets by C$6.12 billion to C$46.5 billion in 2022, it said in a report released on Thursday.

[1/2] Indian Finance Minister Nirmala Sitharaman speaks during a side event on the G20 Finance Ministers and Central Bank Governors Meeting in Nusa Dua, Bali, Indonesia, 14 July 2022. The proceeds from green bonds will not be used to fund hydropower plants larger than 25 MW, nuclear projects and any biomass-based power generation with biomass originating from protected areas, the government said in the green bond framework released on Wednesday. A green finance working committee headed by the Chief Economic Adviser V Anantha Nageswaran will select public sector projects for green financing from those submitted by government departments. The committee will annually identify fresh projects to be funded through green bonds. The Indian government had sought assistance for its green bond framework from the World Bank and CICERO Shades of Green, a Danish firm that helps with environment assessments on green bond frameworks.

At the COP27 climate conference in Egypt, companies and country delegates are discussing ways of enhancing the market for green bonds, or bonds that are linked to projects deemed environmentally beneficial. POPULAR DESPITE THE 'GREENIUMS'Also known as "use of proceeds bonds," green bonds involve a company or government raising money for projects considered environmentally beneficial. SUSTAINABILITY-LINKED BONDSSustainability-linked bonds, or SLBs, comprise a newer and smaller market than green bonds. SOCIAL BONDS, SDG BONDS, AND MOREBeyond bonds focused on environmental outcomes, lie pools of money for related goals around social equity or fair living standards. Social impact bonds, or impact bonds, differ from social bonds in linking financial returns to the desired outcome.

☆ Morning Bid: Fed up waiting
▼ + stars: | 2022-11-02 | by ( ) www.reuters.com time to read: +2 min

The market widely expects a fourth straight 75 basis-point hike, but what comes next has arguably been the bigger issue on investors' minds over the past month. With several parts of the U.S. Treasury yield curve pointing to a possible recession even as data continues to show a still-strong economy, comments from Fed Chair Jerome Powell will take the spotlight. Markets want signs of a pivot, ING economists said. In Asia, Hong Kong and China stocks continued their ascent, a day after social media rumours that China was planning a reopening from strict COVID curbs next year triggered a sharp rally. The rumour was shot down but suggests battered China shares (.SSEC) were primed for a rebound on any signs of positive news.

☆ EXCLUSIVE Greece to borrow up to 8 bln euros from bond markets in 2023
▼ + stars: | 2022-11-01 | by ( Lefteris Papadimas | ) www.reuters.com time to read: +2 min

The country emerged from a decade-long debt crisis in 2018 and since then has relied solely on bond markets to cover its borrowing needs. It has raised about 8 billion euros so far this year. We will borrow 7-8 billion euros from the bond markets," a finance ministry official told Reuters. Greece also plans to issue its first green bond in 2023, an issue which was initially scheduled for this year. Greece, still the euro zone's most indebted country, has a cash buffer of about 38 billion euros, enough to cover its borrowing needs for at least two years without tapping international bond markets.

☆ Bahrain energy strategy expected in six months, nogaholding CEO says
▼ + stars: | 2022-11-01 | by ( Yousef Saba | ) www.reuters.com time to read: +2 min

ABU DHABI, Nov 1 (Reuters) - Bahrain's energy strategy and its state oil holding firm's operation plan are likely to be decided in six months with implementation to begin a year later, the firm's CEO Mark Thomas said on Tuesday. "Junk"-rated Bahrain, a small non-OPEC oil producer, is one of the most indebted countries in the region, and seeks to capitalise on high energy prices. He said international oil firms and regional oil giants Saudi Aramco and ADNOC were being looked at as examples. Nogaholding hired banks to set up an environmental, social and governance (ESG) framework earlier this year, Thomas said, declining to name the banks. That framework is expected to be completed in a few months and will allow the company to issue green bonds if it decides to do so, he added.

☆ Indian billionaire Adani looks to raise $10 bln debt - Bloomberg News
▼ + stars: | 2022-10-21 | by ( ) www.reuters.com time to read: +1 min

BENGALURU, Oct 21 (Reuters) - Indian billionaire Gautam Adani's group plans to raise at least $10 billion in new debt through the next year to refinance large borrowings and fund projects in its pipeline, Bloomberg News reported on Friday, quoting people in the know. The Adani Group plans to use several vehicles including foreign currency debt and green bonds to raise up to $6 billion to swap its current high-interest debt with lower-cost borrowings and deploy the rest for project financing, according to the report. It added that the effort could begin as early as the current December quarter. An Adani Enterprises (ADEL.NS) spokesperson did not immediately respond to a Reuters request for comment. The report comes more than a month after debt research firm CreditSights, a part of the Fitch Group, said it had concerns about the Adani group's overall debt levels, at a time when it is looking to expand aggressively.

☆ Can sustainable soya farming come fast enough to save the Cerrado?
▼ + stars: | 2022-10-18 | by ( Mark Hillsdon | Mark Hillsdon Is A Manchester-Based Freelance Writer Who Writes On Business | Sustainability For The Ethical Corporation | ) www.reuters.com time to read: +12 min

“Crop finance is a key part of soy farmers' business models and there is a huge appetite and market for green finance,” he explains. It’s a message consistent with the UK Soy Manifesto, which now covers 60% of the soy coming into the UK. Unlocking green investment means this can now happen, he adds, by supporting sustainable agriculture and protecting forests in a financially sustainable way that rewards farmers. And ultimately it is the involvement of these traders in screening out “bad soy” on which any sustainable soy scheme succeeds or fails. The Retail Soy Group’s roadmap commits members to deforestation-free soy with a cut-off-date of August 2020, but soy traders aren’t following these guidelines, says Wijeratna.

Oct 18 (Reuters) - Austria raised 1 billion euros ($983.20 million) on Tuesday from the auction of the first ever green T-bill, a move aimed at attracting shorter-term investors to buy environmentally friendly assets. But with central banks and a wider group of investors interested in green investments to bolster their sustainability credentials, interest in shorter-term green debt is growing. Austria, rated AA, is the first government to issue a green T-bill - short-term government debt which usually matures in less than a year. Markus Stix, director of the Austrian Treasury, called short-term green securities the "missing link" in the green market. It was easier for Austria to shift expenditure for funding through green T-Bills, given its overall T-Bill programme was only launched in 2021 and it just started issuing green debt, the banker said.

☆ Saudi Arabia sells $5 bln in first bond deal in almost a year
▼ + stars: | 2022-10-18 | by ( Yousef Saba | ) www.reuters.com time to read: +3 min

DUBAI, Oct 18 (Reuters) - Saudi Arabia sold on Tuesday $5 billion in Islamic and conventional bonds for which demand topped $26.5 billion as it held its first international bond sale in almost a year. "Saudi is a fairly logical substitute for Russia and its weight in indices such as the JPMGBI (JPMorgan Government Bond Index) has been growing." Saudi Arabia's finance ministry on Tuesday also invited holders of its $3 billion bonds due in 2023, $4.5 billion notes due in April 2025, $2.5 billion bonds due in October 2025 and $5.5 billion notes maturing in 2026 to tender them for cash. Saudi Arabia's sovereign wealth fund, the Public Investment Fund, raised $3 billion with green bonds in its debt markets debut earlier this month. Saudi Arabia raised $3.25 billion in bonds in November via sukuk and bonds, after issuing bonds worth 1.5 billion euros in February and $5 billion in January last year.

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