For A-rated banks, we find a greenium of up to 7.5bps at the 10yr point, while BBB-rated utilities show a more modest effect, generally ranging between 4-9bps across most maturities. Much of this difference reflects the composition of each labelled bond universe: Swedish banks and UK utilities are overweight in GSST issuance, while US issuers in both sectors remain concentrated in conventional bonds.
Beyond pricing, GSST bonds offer investors more transparency on capital expenditure and transition plans than conventional bonds raising funds for similar purposes. This can support more informed credit analysis and allow investors to hold higher-emitting issuers within a portfolio while engaging for greater disclosure.
