UK Green Bonds Spark a Record Surge in 2023
By the close of September, British corporations had pulled in a whopping £6.1 billion from eight green bond issuances—an impressive jump from the £4.9 billion raised in the first nine months of 2019. This boom was powered by two titanic deals from Thames Water and DS Smith PLC, whose offerings were the largest green bonds ever seen in the market.
Corporate‑centric Green Financing
All green bond activity in 2023 has been corporate‑led. Since the third quarter of 2022, there have been no sovereign or agency issuances in the UK. In other words, the public sector has been quietly holding back, letting the private world take the lead.
Where the UK Stands in the Global and European Picture
The United Kingdom currently sits at 14th place worldwide, contributing a modest 2.1 % of global green bond issuance during the first nine months of 2023. In Europe, the UK takes the ninth spot, trailing the giants: Germany, Italy, and France—who enjoy the top three spots.
Takeaway
- Corporates are the main players in UK green bonds for 2023.
- Record raising thanks to massive deals from Thames Water and DS Smith.
- UK’s global ranking stays solid, with a small but steady share of the green market.
All in all, the UK’s corporate green bond channel is humming, proving that even the greenest of bonds can be both eco‑friendly and financially rewarding.
Sumitomo Mitsui Financial Group Takes the Crown in UK Green Bond Underwriting
Mounting the green ticket: Sumitomo Mitsui Financial Group Inc. (SMFG) swooped into the top spot for UK green bond underwriting last quarter, raking in a hefty £774.6 million and grabbing a 12.8 % share of the market.
Compared with the same period last year—when SMFG only managed £219.3 million and a 2.2 % slice of the pie—this is a jaw‑dropping jump. Barclays and the Bank of China followed suit, forming the triumvirate of the most active underwriters.
Quarterly Green Bond Pulse
- In Q3 2023, UK green bonds pulled in £1.9 billion from just two issuances.
- This marks a kick‑up from the £1.3 billion raised in Q2 2023 (also from two issuances) but a steep decline from the £4.6 billion haul of seven issues in Q3 2022.
According to Cornelia Andersson, Head of Sustainable Finance and Investing at LSEG, the UK is racing ahead in green finance: “Corporates are stepping up the game while agency and sovereign issuance remains a little quieter so far this year.”
Andersson rattles off some optimistic vibes: “With COP28 kicking off, we’re bracing for bold new plans from policymakers, businesses, and civil society. And as we close out 2023 and slide into 2024, rates might plateau or even trim a bit—good news for market confidence.”
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