Enel Forced to Raise Coupons on $11 Billion of ESG Bonds
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 23 2024
0mins
Should l Buy ?
Source: Bloomberg
- Enel to Increase Coupons on Sustainability-Linked Bonds: Enel will raise the coupons it pays investors on sustainability-linked bonds due to missing greenhouse-gas emissions targets, triggering a penalty.
- Significant Financial Impact: The missed 2023 goal will result in Enel bonds paying approximately €83 million ($89 million) in additional interest, affecting bonds worth about $11 billion.
- Market Response and Implications: The energy crisis from Russia's invasion of Ukraine is impacting companies' climate commitments, with Enel facing consequences for not meeting its emission reduction targets.
- Investor Behavior and Market Dynamics: Investors are still learning how sustainability-linked bonds behave under pressure, with expectations of missed targets affecting bond prices.
- Positive Outlook for SLB Market: Despite the penalty, there is optimism for the sustainability-linked bond market as it demonstrates ambitious targets and potential benefits for investors.
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About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
