UOB adopts Bloomberg Barclays MSCI Global Green Bond Index for ESG Investment Solutions
Customers of UOB can now invest in green bonds selected from the Bloomberg Barclays MSCI Global Green Bond Index, reports UOB.
UOB is the first Singapore bank to adopt the globally-recognised index, as part of the bank’s move to integrate environmental, social and governance (ESG) considerations into its full suite of investment solutions, the firm said in a press release.
The Bloomberg Barclays MSCI Global Green Bond Index, launched in 2014, is part of a family of Green Bond Indices in the Bloomberg Barclays MSCI ESG Fixed Income benchmark offering. Fixed-income securities are independently evaluated by MSCI ESG Research along four dimensions to determine whether a security should be classified as a green bond. These eligibility criteria reflect themes articulated in the Green Bond Principles and require clarity about a bond’s use of proceeds; process for green project evaluation and selection; process for management of proceeds; and commitment to ongoing reporting of the environmental performance of the use of proceeds.
Ji Zhuang, Head of Indices, APAC, Bloomberg, said: “The Bloomberg Barclays MSCI Global Green Bond Index provides transparency to the growing green bond market, which recently crossed the USD1 trillion mark in total issuance, giving investors a way to evaluate performance and assess risk of projects with direct environmental benefits. We are pleased that UOB customers can be part of the growing number of global investors keen to mitigate climate change effects through their investment portfolios. We look forward to providing more climate and low carbon benchmarks.”
Jacquelyn Tan, Head of Group Personal Financial Services, UOB, said: “We are seeing growing customer interest in sustainable investments, including in green bonds. The Bloomberg Barclays MSCI Global Green Bond index is a globally-recognised standard and adds to the accountability of the ESG solutions we offer to our customers. Adopting the standard as our benchmark is also in line with UOB’s Risk-First wealth advisory approach to helping our customers understand the risks of investments, ahead of any potential returns. We will continue to steer our customers’ wealth to sustainable investments as we forge a sustainable future together.”
According to Bloomberg data, global green bond issuance this year (as at Nov 17, 2020) has climbed to more than USD270 billion, surpassing last year’s total to hit a record, reports UOB. That comes as more companies and governments are turning to green securities for the first time to fund projects for cleaner growth. The market will get a further boost next year from the European Union, which will become the world’s largest issuer when it starts to sell 225 billion euros of green bonds as part of its pandemic recovery fund.