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HSBC Global Asset Mgmt, IFC Fund Raises $474M For Climate Action in Emerging Markets


IFC:
Jay Pulizzi
Phone: +1 (202) 473-3031
Email: hpulizzi@ifc.org

Elizabeth Lewis
Phone: +1 (202) 458-4049
Email: emlewis@ifc.org

HSBC Global Asset Management:
Mat Barling
Phone: +44(0) 207 992 5568
Email: mathew.barling@hsbc.com
   
Charles Clarke
Phone: + 44(0) 207 991 8805
Email: charleswclarke@hsbc.com


LONDON/WASHINGTON, May 20, 2020—HSBC Global Asset Management and IFC, a member of the World Bank Group, today announced the third closing of the HSBC Real Economy Green Investment Opportunity GEM Bond Fund (REGIO), which has raised $474 million of new financing to support climate mitigation investments across emerging markets in spite of prevailing market turmoil.

Emerging market countries have been hit by some of the worst impacts of climate change and many are insufficiently equipped to address them. REGIO is designed to attract investments into these economies, enabling their energy transition and helping them limit the effects of climate change.

The first green bond fund focused on emerging market real sector issuers, REGIO will use both public and private capital to build climate change mitigation capacity in emerging market economies. HSBC and IFC each committed $75 million to the fund as anchor investors. Seven private investors have now joined HSBC and IFC, with others expected to commit later this year.

Noel Quinn, Group Chief Executive, HSBC, said: “At HSBC we have a long history of connecting markets with opportunities and we recognise that economic growth must be sustainable over the long term. Investors want more socially and environmentally responsible investment opportunities and funds such as REGIO are a way for them to achieve their sustainable objectives.”

Philippe Le Houérou, CEO of IFC, said: “The success of this fundraising is proof that investors remain committed to fighting climate change, even at this time of global pandemic. IFC is proud to have helped shape climate finance capital markets by issuing and investing in green bonds and establishing market standards. Innovative solutions like this fund create tangible action on the ground at a time of great urgency.”

Through its investment, REGIO will both catalyse climate finance globally and create viable markets for the development of climate-friendly projects. The fund provides a solution for global institutional investors to achieve impact and generate sustainable returns at the same time. The fund will invest in a diverse range of geographies and companies in the real sector through a diversified portfolio of green and sustainable bonds.

Nicolas Moreau, Global CEO, HSBC Global Asset Management, said: “We are at a tipping point in terms of climate change and investing in the real economy in emerging markets is critical to achieving the global transition to a lower carbon economy. Funds such as REGIO prove how we can achieve real economy impact in the markets that are most challenged by it.

“To achieve a close of this size in the current market environment proves the importance that institutional investors place on impact investing in emerging markets. We recognise the role we can play in enabling our clients to meet their sustainable investment objectives and support the Sustainable Development Goals. We hope that the green impact investment framework behind REGIO and its commitment to sustainable development is something that will be taken up by the wider industry.”

The fund is supported by HSBC Global Asset Management’s ‘Green Impact Investment Guidelines’ which set out a framework for the firm’s green impact strategies across asset classes, including eligible projects and activities aligned with impact. The framework aims to show potential bond issuers the eligibility criteria the firm will apply when selecting green bonds for REGIO. The framework is aligned to the SDGs and their targets and indicators and contributes directly to financing the objectives of the Paris Climate Agreement.

To bolster the supply of green bonds issued by real sector borrowers, REGIO’s investment activities will also be complemented by a Technical Assistance Facility managed by IFC.

About IFC
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2019, we invested more than $19 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org.
 
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About HSBC Global Asset Management
HSBC Global Asset Management, the investment management business of the HSBC Group, invests on behalf of HSBC’s worldwide customer base of retail and private clients, intermediaries, corporates and institutions through both segregated accounts and pooled funds. HSBC Global Asset Management connects HSBC’s clients with investment opportunities around the world through an international network of offices in 25 countries and territories, delivering global capabilities with local market insight. As at 31 March 2020, HSBC Global Asset Management managed assets totalling US$483bn on behalf of its clients. For more information see www.global.assetmanagement.hsbc.com

HSBC Global Asset Management is the marketing name for the asset management businesses of HSBC Holdings plc.  

About HSBC Holdings plc
HSBC Holdings plc, the parent company of HSBC, is headquartered in London. HSBC serves customers worldwide from offices in 64 countries and territories in its geographical regions: Europe, Asia, North America, Latin America, and Middle East and North Africa. With assets of US$2,918bn at 31 March 2020, HSBC is one of the world’s largest banking and financial services organisations.