Reinsurer Munich Re has launched its second green subordinated bond after a successful issuance in 2020, designed to reinforce its capital base with a focus on emerging growth opportunities in reinsurance markets.
Organic growthThe volume of this issue is €1 billion (USD 1.2 billion) and the bond has a coupon of 1 percent and will mature in 2042.
In comparison, the 2020 green bond issuance totalled €1.25 billion (USD 1.46 billion), has a coupon of 1.25 percent and is scheduled to mature in 2041.
The launch of the second green bond in its corporate history supports the company’s climate strategy.
As part of Munich Re’s Ambition 2025, the company has adopted a broad climate protection programme featuring concrete climate protection targets for its investments, insurance business, and operations.
Liberty Mutual Reinsurance
The firm intends to use the raised capital to finance or refinance sustainable projects in accordance with its Green Bond Framework.
According to Munich Re, these projects include investments of equity and debt in renewable energy, energy efficiency, clean transportation, green buildings, sustainable water and waste water management, the co-efficient and/or circular economy, and the environmentally sustainable management of natural resources and land.
Ultimately, this bond underlines the company’s commitment to using the capital markets to help achieve a climate-friendly transformation of the economy.
Christoph Jurecka, Chief Financial Officer (CFO) at Munich Re, commented: “Climate protection is an integral part of our Ambition 2025 Group strategy. By issuing a green bond, we have once again leveraged the capital markets to fund green investments. We strengthen our capital base, which gives us the financial flexibility to take advantage of current growth opportunities.”