Green bond
An issue whose proceeds are directed, by the terms of the offering, to projects with a declared environmental effect.
How to read the number
What differs from an ordinary issue is not the risk but the earmarking of the money and the duty to report where it went.
When the metric lies
Credit risk remains the risk of the same issuer; the label adds nothing to the ability to pay. How deeply compliance is checked depends on the verifier, and verifiers differ.
Also known as: esg bond, use of proceeds bond