Fossar manages first domestic issue of green bonds


The City of Reykjavik’s issue of green bonds is the subject of an article in the latest edition of Markaðurinn (The Market), Fréttablaðið’s weekly business and economics supplement. Markaðurinn talks to Andri Guðmundsson, Managing Director of Fossar Markets’ Corporate Finance, about the issue and the importance of green bonds. Fossar managed the bond sale on Reykjavik’s behalf.
Among other things, Guðmundsson points out that by issuing green bonds the issuer sends a clear message about supporting environmental protection and awareness of the grave threat associated with climate change.

Green bonds come with additional benefits
“It is vital that a major player, who regularly issues bonds, leads the way in green bond issuance in Iceland,” Guðmundsson says in Markaðurinn. The City of Reykjavík’s issue is the first denominated in Icelandic kronur (ISK).

Green bonds are issued to fund projects that have positive environmental or climate benefits, in particular, those aimed at reducing greenhouse gas emission. While stressing the issuer awareness about environmental issues, Guðmundsson also points to additional benefits associated with the issue of green bonds.

“The issuers often point out that green bonds call for increased inter-departmental cooperation, where departments that otherwise only associate with each other during company social events, now must work together. The Environmental department and Financial department, for example, have to cooperate, not only in preparing the issue but in the long run, because of investor’s increasing demand for information about the green projects’ positive effects,” Andri Guðmundsson says in the interview.

Fossar brought Mats Andersson to Iceland
The Markaðurinn’s article also points out that Fossar Markets brought Mats Andersson, former CEO of the Swedish pension fund AP4, to Iceland for talks with investors and the government about green bonds.

„Andersson also headed a Swedish Treasury Department’s committee on how to strengthen the Swedish green bond market,” the paper says. Andersson now works as an advisor to the French government on its issue of green bonds.
„Among other things, Andersson touched upon how climate change affects investors in years to come and how investors can deflect environmental risks by channelling their investments into green bonds and shares.”

Markaðurinn’s coverage and interview with Andri Guðmundsson can be found (in Icelandic) HERE on Fréttablaðið’s website.