A Case Study Of Green Bond Issuance By Industrial Bank

Rapid economic development of our country has brought enormous pressure on resources and the environment.The development of green finance is the best choice to promote the sustainable development of our national economy.In recent years,our country has been paying more and more attention to green development and has continuously introduced various policies to support economic transformation and upgrading to green.As an important part of green finance,green bonds have started to develop rapidly.Especially under the national goal of "carbon peaking and carbon neutral",it is a new opportunity to develop green bonds.However,the proportion of green bonds in the issuance scale of the whole bond market is only 0.98%at present,and the scale advantage of ordinary bonds is still prominent,which does not match with the increasing demand for green financing at present,and the activity of green bond issuing entities needs to be further strengthened.How to issue green bonds better has become a pressing concern.Industrial Bank is the first bank to issue green bonds in China,and it is a typical representative of successful green bonds issuance.This paper takes the issuance of green bonds by Industrial Bank as the research object.Combining the relevant literature from home and abroad,after introducing the basic information of Industrial Bank,the process of issuing green bonds,the risks of green bonds and the issuance of green bonds by Industrial Bank,the paper conducts an in-depth study on the issuance of green bonds by Industrial Bank from three aspects:the effect of issuance,the reasons for successful issuance and the questions in the process of issuing green bonds.The study found that the issuance of green bonds by Industrial Bank can produce positive effects in three aspects:market effect,financial effect and social effect.Firstly,issuing green bonds can bring significant positive impact on the issuer’s share price in the short term.Secondly,issuing green bonds can improve the asset quality,profitability and growth ability of issuers.Lastly,issuing green bonds can help to provide financial support for corporate green projects.And it can generate positive environmental benefits and promote the development of green bond market.The reasons for successful issuance of green bonds by Industrial Bank include four aspects.Firstly,Societe Generale has a relatively good financial position,which has laid the foundation for issuing green bonds.Secondly,in order to ensure that the funds raised are invested in the green field,Industrial Bank determines whether the projects have green attributes.Thirdly,Industrial Bank established an environmental and social risk management system to prevent the risk of green bonds.Lastly,Industrial Bank hired professional third-party institutions to strengthen information disclosure.However,there are still shortcomings in the issuance of green bonds by Industrial Bank.On the one hand,from the issuer level,there are problems such as short duration of green bonds,unsound risk warning mechanism and immaturity of green financial sector;On the other hand,from the government level,there are problems such as unsound third-party certification mechanism,lack of environmental protection information sharing platform and unsound corporate environmental information disclosure system.Based on the study,the paper puts forward some suggestions from the issuer and government levels to promote issuance of green bonds in China.