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Yen Green Bonds

Yen Green Bonds:

REC Limited issued the first Japanese Yen green bonds worth JPY 61.1 billion.

  • REC Limited, a Maharatna Central Public Sector Enterprise (CPSE) under the Ministry of Power, has achieved a significant milestone by issuing its inaugural Japanese Yen (JPY) 61.1 billion (approximately Rs 3,500 crore) green bonds.
  • Yen green bonds is REC Limited’s eleventh venture into the international bond market and inaugural Yen Bond issuance, which is also the first Yen Green Bond issuance by any Indian PSU.
  • These bonds, part of the $ 10 billion global medium-term notes programme, span 5-year, 5.25-year, and 10-year tenures.
  • Proceeds from the bond issuance will be dedicated to financing eligible green projects, adhering to REC Limited’s green finance framework, Reserve Bank of India’s (RBI) external commercial borrowings guidelines, and relevant approvals.
  • It is the first Yen Green Bond issuance by any Indian PSU.
  • It is the largest ever Euro-Yen issuance in South and South East Asia.
  • It is the largest Yen-denominated issuance from India.
  • It is the largest non-sovereign Yen-denominated issuance ever from South and South East Asia.
  • Green bonds are financial instruments designed to raise capital specifically for projects that have positive environmental and/or climate benefits.
  • Green bonds function similarly to regular bonds, offering fixed or variable interest rates to investors.
  • However, the key difference lies in the use of proceeds.