GSS/S issuance for SSAs falls after strong start to 2023

In our monthly Sovereign, Supranationals and Agencies (SSA) sustainability newsletter we breakdown the trending ESG* trades and themes, helping SSAs get ahead of the latest issues shaping the market.

Primary Market Activity [1]

The EUR market saw all the action in March (6 transactions; €9.8bn), whilst the USD and GBP market remained shut. This was a result of worsening sentiment amongst investors given recent events in the US regional banking sector and Credit Suisse.

Market activity:

Secondary Market Activity

For further analysis and information on the Secondary Market, please take a look at the full monthly newsletter on Market Insights. If you do not have access to Market Insights, please contact us here.

SSA GSS/S Issuance

GSS/S issuance quietened through March, (-34% compared to 2022), driven by the increase in volatility faced by the market.

Green GSS/S issuance (c. €47bn) represents 46% of GSS/S issuance in 2023 year-to-date (YTD), with a slight lead relative to social and sustainable issuance (24% and 30% respectively).

The largest portion of GSS/S issuance is commanded by Agencies (41%) followed by Supranationals (33%) and Sovereigns (15%).

SSA GSS/S Supply 2022-2023 YTD

Source: Dealogic (28/03/23)

Global EUR/GBP/USD SSA GSS Issuance

  • Sovereign. YTD Sovereigns have a GSS issuance of €35.6bn, entirely consisting of green bonds; several new issuers have entered the sovereign green market including India and Israel.
  • Supranationals. YTD Supranationals have a GSS issuance of €34bn, led by sustainable bonds (46%) and green (45%), with social issuance lagging (9%).
  • Agencies: YTD Agencies have a GSS issuance of €41bn, led by social bonds (46%), then followed by green (39%), with sustainable issuance lagging (15%)

SSA GSS/S Private Placements

The Japanese GSS private placement market saw Taiju Life invest AUD 50mn into a 15yr green bond, issued by the African Development Bank. Taiju cites that this private placement will be used to support efforts in climate change mitigation and adaptation. It also builds on the commitments made at the 8th Tokyo International Conference on African Development where Japan announced its intention to support sustainable green growth in Africa.

Notable conferences in March

UN 5th Conference on the Least Developed Countries

  • Member States announced commitments to deliver the Doha programme that aims to support improving biodiversity, tackling malnutrition, and building resilience for the 1.2bn people living in the world’s poorest countries.
  •  The recent meeting saw several commitments made by major developed economies: USD60m from Qatar, EUR200m from Germany, EUR130m from the European Commission and CAD59m from Canada etc.

UN 2023 Water Conference

  • Stakeholders discussed the crucial challenges around overconsumption and unsustainable use, coupled with evaporation due to global warming.
  • The conference spurred almost 700 voluntary commitments from stakeholders, however the organising Member State’s did concede that a formal global agreement like the 2015 Paris Agreement alongside better data and an international finance mechanism could better safeguard water supplies.
  • The current pace of investment would mean that the sustainable development goal (SDG 6: water and sanitation) would not be achieved for decades after the 2030 target. According to WaterAid, investment needs to more than triple (at least $200bn a year) to close the current financial gap and ensure the global population can access safe water and sanitation by 2030.

In April, the following major ESG events and conferences will occur:

SSA Sector Developments

Investor Developments

Government and Regulatory Developments

ESG and Credit Rating Agencies Developments

Find out more

If you would like to discuss any of the above further, please reach out to our authors:

*For any unfamiliar terms used within this article please refer to our Insights glossary.

Additional information

[1] Source: Bloomberg, BondRadar, 03/04/23

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