The first half of 2019 has seen global sustainable finance continue to flourish. Refinitiv LPC has recorded nearly $39 billion of global green and sustainability linked loan (SLL) volume through May – a 60% increase over the same time last year. In Refinitiv LPC’s “Loanly Planet” publication that volume is broken down regionally. EMEA continues to be the regional leader in terms of issuance with 70% of the global volume, or $27 billion. However, the biggest increase in regional volume has been in the Americas. With more than $7.3 billion in green loan and SLL volume through May 2019 on the books, that seven-fold increase is evidence that sustainable finance is gaining traction on this side of the pond.
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Tess Virmani is Associate General Counsel & Senior Vice President, Public Policy of the Loan Syndications and Trading Association (LSTA). Ms. Virmani focuses on developing market standards and maintaining LSTA documentation. She also leads the LSTA’s sustainable lending efforts. In addition, Tess participates in the LSTA’s policy initiatives, including market advocacy and spearheading industry solutions to market developments, such as the transition to replacement benchmarks.
(updated on January 31, 2019) – For the third straight year, the World Economic Forum listed environmental threats as the biggest risk facing the global economy. So, it was timely that Tess Virmani, Associate General Counsel of the LSTA, participated in the Green Finance Seminar hosted by Banco de Mexico in Mexico City this week. The seminar, held in conjunction with the meeting of the Steering Committee of the Network of Central Banks and Supervisors for Greening the Financial System (NGFS), pulled together central banks and supervisors from all over North, Central and South America to educate them on the current state of, and challenges to, sustainable finance and possible ways forward. Sessions included a look at several of the voluntary frameworks informing activities in the sustainable finance sector. These included aspirational, industry-wide frameworks, such as the UNEPFI Principles of Responsible Banking and the Principles of Responsible Investment as well as transaction-focused frameworks, such as the Green Bond Principles and Green Loan Principles.
We were delighted to host 1,100 members (and future members) at the LSTA’s Annual Loan Conference on October 24th. As befits the times, the conference focused on Managing Risk (today) and Optimizing the Future. Below, we discuss the themes that surfaced during the day, offer the main takeaways and, of course, thank our attendees and 28 sponsor and exhibitors. Most presentations are available on this presentation page of www.lsta.org.
An area of increasing attention in the US loan market is ESG (Environmental, Social and Governance). Thomson Reuters LPC reports global green and sustainable loan issuance has totaled nearly $17 billion, over twice 2017’s totals. Green bond issuance has led the way in the global debt markets, but green loans are emerging as an intriguing alternative. Although dwarfed by activity in EMEA and the rest of the world, 2018 has seen $2.2 billion of green and sustainable activyt in the Americas.
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