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Canada’s ESG Market Gains Ground as Toronto Saves on Debt Costs

  • Approximately 25% of city’s deal placed with investors abroad
  • At least four issuers got cheaper financing than regular bonds
Canada’s green bond market is gaining traction with the City of Toronto the latest borrower to lock in cheaper financing than would have been possible through a conventional debt sale.

Canada’s green bond market is gaining traction with the City of Toronto the latest borrower to lock in cheaper financing than would have been possible through a conventional debt sale.

Photographer: Bloomberg/Bloomberg

Canada’s green bond market is gaining traction with the City of Toronto the latest borrower to lock in cheaper financing than would have been possible through a conventional debt sale.

The country’s financial capital sold a C$130 million ($101 million) green issue maturing in 2039 on Tuesday at a spread of 118 basis points over the nation’s yield curve. That’s two to three basis points tighter than where a regular bond would have priced, according to Randy LeClair, the city’s director of capital markets. The transaction, which marks the completion of Toronto’s funding plan for the year, saw demand of about four times the amount of debt issued with orders placed from 36 investors.