European Investment Bank Climate Awareness Bonds
The European Investment Bank (EIB) is the lending arm of the European Union. It is the largest multilateral financial institution in the world and one of the largest providers of climate finance.
- The EIB issued the world’s first green bond, labelled a Climate Awareness Bond (CAB), in 2007. Use of proceeds from the bonds match disbursements to EIB lending projects that contribute to climate action through renewable energy and energy efficiency works.
- In 2019, the EIB board of directors approved a new set of targets for climate action and environmental sustainability, including climate finance initiatives that support the European Green Deal and will help make Europe carbon-neutral by 2050.
Pfizer, Inc. (Sustainability Bond)
Pfizer Inc. offers medicines, vaccines, medical devices and consumer healthcare products for oncology, inflammation, cardiovascular and other therapeutic areas.
- In August 2021, the company issued its second sustainability bond to date, with proceeds of the bond intended to be used for COVID-19-related research and development.
- Specifically, the key selection criteria for the eligible projects includes research and development expenses related to COVID-19 vaccine research and development and capital expenditures in connection with the manufacture and distribution of COVID-19 vaccines.
US International Development Finance Corp.
US International Development Finance Corp. (DFC) is America’s development bank.
- The agency issued the first US government-backed investment vehicle to support women’s economic empowerment in emerging markets. Specifically, the use of proceeds from the bond will enable lending for micro, small, and medium enterprises owned by women in Ecuador. It is expected to reach more than 53,000 female entrepreneurs in the first five years of the project.
- The agency partners with the private sector to finance solutions to the most critical challenges facing the developing world and has issued several bonds with use of proceeds targeting climate change mitigation, women’s empowerment and affordable housing.
Sunrun Solar Asset Backed Securities
Sunrun Inc. is a leading residential solar, storage and energy services company. The company designs, installs, finances, insures, monitors and maintains the systems, while customers receive predictable pricing for 20 years or more. The company also offers a home solar battery service that manages household solar energy, storage and utility power.
- Sunrun Solar Asset Backed Securities are the securitization of a pool of leases and power-purchase agreement contracts related to residential solar installations.
- A typical pool of leases and power purchase agreements will be backed by a diverse portfolio of thousands of solar rooftop systems distributed across multiple utility service territories in the United States and Puerto Rico.
Green Mortgage Backed Securities
Impax invests in Green Mortgage Backed Securities issued by Fannie Mae and Freddie Mac, two government-related entities established to support liquidity, stability and affordability to the US housing market. Each entity offers green bonds under separate programs:
- Fannie Mae Multifamily offers Green Rewards, a product feature that provides lower pricing, additional loan proceeds, and a free energy and water audit report to finance smarter, greener property improvements, including new ENERGY STAR appliances, energy-efficient HVACs, WaterSense labeled low-flow fixtures, LED lighting and solar photovoltaic (Solar PV) systems.
- Freddie Mac has a similar program — Green Advantage — which focuses solely on workforce housing. Borrowers must be able to reduce whole property energy consumption by at least 15% and reduce either energy and/or water whole property consumption by an additional 15% for a total of 30% reduction in whole property energy and water consumption.
Pax Core Bond Fund Top 10 Holdings
|United States Treasury Note, 3.375% 8/15/42||4.10|
|United States Treasury Note, 4.125% 9/30/27||3.90|
|United States Treasury Note, 3.0% 8/15/52||2.80|
|United States Treasury Note, 3.5% 9/15/25||1.70|
|United States Treasury Note, 2.875%, 4/30/29||1.10|
|United States Treasury Note, 2.75% 8/15/32||1.10|
|European Investment Bank, 3.25%, 1/29/24||1.00|
|International Bank For Reconstruction & Development, 1.625%, 1/15/25||1.00|
|European Investment Bank, 2.5%, 3/15/23||0.70|
|Kfw Bankengruppe, 2.625%, 2/28/24||0.60|
Holdings are subject to change.