The Swedish Pensions Agency is the latest pension provider to announce it has invested in the Swedish government’s new green bond, which launched on 1 September.

It follows the announcement by Alecta yesterday, 2 September, that it has invested SEK 4.25bn in the Swedish government’s green bond. The pension agency’s SEK 1bn investment is part of its investment portfolio for those with traditional insurance.

"The pension agency's investments should strive to contribute to the UN's global sustainable development goals and this investment is in line with this ambition," Swedish Pension Agency asset manager, Inger Söderbom, said.

Government issued green bonds are proving to be popular with pension funds. Last year Denmark’s PFA invested DKK 1.3bn in green bonds issued by the Dutch government. Following in the Netherlands and Sweden’s footsteps, Germany has become the third AAA-rated country to issue a green government bond, today, 3 September.

Germany is introducing a new concept of ‘Green Twin Bonds’, where a green bond is issued with the same maturity and coupon as a conventional bond. The green bond is a separate bond with a smaller issue volume than the conventional bond.

The aim of this structure is to ensure that the issuance of green bonds does not negatively influence the overall liquidity in German government bonds. It also makes it easier for there to be a natural diversification between conventional and green bond investors.

“We strongly support the issuance of green German government bonds,” NN Investment Partners lead portfolio manager green bonds, Bram Bos.

“The concept of ‘Green Twin Bonds’ is a new and innovative form of green bond issuance we favour. We think this concept is a much better option than the concept currently being explored by the Danish government, which is looking to issue separate green labels or stickers which could be attached to any conventional bond”

Share Story: