Axios Pro Exclusive Content

Abu Dhabi's Masdar lists first green bond on LSE

Katie Fehrenbacher

A concentrated solar power plant in al-Gharibiyah district on the outskirts of Abu Dhabi. Photo: AFP/Getty Images

Masdar, the clean energy company of United Arab Emirates, listed its debut $750 million green bond fund on the London Stock Exchange on Monday.

Why it matters: The market for sustainable bonds continues to grow, especially in the Middle East, despite a cooling economic market.

Driving the news: Abu Dhabi-based Masdar's first green bond issuance will fund clean energy projects and is part of a plan to raise up to $3 billion for 100 GW of clean energy capacity by 2030.

  • Masdar completed the green bond issuance in July through the sale of 10-year senior unsecured notes and said the issuance was "more than five times oversubscribed."
  • Masdar plans a secondary listing of its green bond offering later this year on Abu Dhabi Securities Exchange.

Big picture: Moody's forecasts $950 billion in global sustainable bond issuances in 2023, which includes green bonds.

  • Moody's VP of sustainable finance, Matthew Kuchtyak, said that sustainable bonds had seen unfettered growth up until 2021 and 2022 when there was a significant pullback from bond issuers.
  • However, 2023 is seeing a bit of a bounce back, and sustainable bond issuances are trending above Moody's forecast.

Zoom in: The Middle East is seeing particular growth in sustainable bond issuances.

  • Combined, the Middle East and Africa saw the amount of sustainable bond issuances increase to 29% of all bond issuance in the first half of 2023 from 12% across all of 2022, according to the Moody's report.
  • Kuchtyak said this growth in the Middle East resulted from a combination of a smaller market growing, regions diversifying away from hydrocarbons and toward clean energy, and regions looking to make debuts before COP28, which will be hosted in Dubai.
Go deeper