The Global Green Bond Initiative (GGBI) Fund is now live, backed by roughly €800m in equity from a consortium of European development finance institutions led by the European Investment Bank, alongside EBRD and development banks from Spain, Italy, the Netherlands, Germany, and France.
The European Commission is providing credit protection via its EFSD+ Guarantee.
The fund is managed by Amundi, Europe's largest asset manager, and is designed to crowd in up to €2bn from private investors on top of a public equity base of around €1bn.
Additional contributions are expected from Luxembourg's LuxDev and, pending documentation, the Green Climate Fund.
Buys bonds in developing countries
The fund buys bonds in primary markets only, with a preference for first-time issuers – governments, municipalities, and businesses in developing economies.
At least 20% of capital must flow to the world's least developed countries, with flexibility for both local currency and euro-denominated bonds.