Brazil's first green bond issue yields $2 bi

Brazil's first issue of sustainable public bonds on the international market yielded $2 billion, confirming the most recent estimates presented by the Brazilian National Treasury, as announced by Finance Minister Fernando Haddad.

The green bonds are designed to provide an annual return, or interest, of 6.5 percent. As the bonds mature, the Brazilian government will honor this commitment by repaying the $2 billion raised on the New York Stock Exchange at a rate of 6.5 percent per year.

The spread, representing the difference between the interest rates on Brazilian bonds and US Treasury bonds—recognized as among the safest globally—stood at 181.9 basis points. This equates to 1.819 percentage points higher than US bonds.

Both the interest rate and the spread serve as barometers of Brazil's appeal to investors. Lower values signify greater confidence in Brazilian bonds on the international stage.

Minister Haddad celebrated the outstanding news of a spread around 180 points, emphasizing, "This means that, regardless of the rating agencies, the international market sees Brazil as a country with an investment grade equal to Mexico."

Sustainable investment

These foreign-issued federal bonds, known as green bonds, are tied to environmental commitments. Rather than providing solely financial interest, foreign investors will reap returns from a sustainable project, with an annual yield of 6.5 percent.