PFC: Green bonds on Luxembourg Stock Exchange

June 3, 2022

State-owned Power Finance Corporation (PFC) has announced that its maiden green bonds worth 300 million euros have been listed on the Luxembourg Stock Exchange (LSE). RS Dhillon, PFC Chairman and Managing Director (CMD) rang the bell during the listing ceremony that was held in GIFT IFSC Gujarat.

The listing has been done under which agreement?

This listing has been done under the cooperation agreement that has been signed between LSE and India INX. This agreement was signed to encompass the areas of mutual interest in ESG space and Green bonds. PFC has listed its maiden green bonds on Luxembourg Stock Exchange (LSE), which is the world’s largest green bond listing platform.

How would this listing help PFC?

In the year 2021, PFC announced that the organization will be issuing bonds worth 300 million euros for seven years. With this, the company would be foraying into the European markets for the very first time. By listing on the LSE, PFC would be able to strengthen its presence in the European market, which will help facilitate future financing so that the green energy goals set by the Indian government can be achieved. The listing will also give PFC an opportunity to boost its visibility amongst the European investors.

What is Power Finance Corporation?

The PFC is an Indian financial institution that falls under the ambit of the Ministry of Power. This organization was established in the year 1986 and is the financial backbone of the Indian Power Sector. PFC is India’s largest non-banking financial corporation (NBFC) in the power sector.

What are Green Bonds?

Green bonds are types of fixed-income instruments that are used to raise money for environmental and climate projects. These bonds are generally asset-linked and are backed by the balance sheet of the issuing entity, hence, they carry the same credit rating as the other debt obligations of the issuer.

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