Subsidiary of UniCredit Bank, Structured Invest S.A., has partnered with MSCI ESG to issue a European green bond ETF.
The UC MSCI European Green Bond EUR UCITS ETF (ECBI) provides investors access to a diversified range of euro-denominated green bonds from European issuers, an ETF first according to UniCredit.
ECBI tracks the Bloomberg Barclays MSCI European Green Bond Issuer Capped EUR Index and is comprised of green bonds from issuers in a variety of sectors and European locations. A green bond is a fixed-income financial instrument which funds projects which have positive environmental and climate benefits.
MSCI has been involved with numerous Environmental and Social Governance products since ESG investing grew in popularity. The index provider says the number of investors who aim to fight climate change by investing in green bonds has significantly increased.
Antonio Keglevich, Head of Sustainability Bond Origination at UniCredit, said in a statement: "Green bonds offer investors the possibility to invest easily in projects with direct relevance for environmental protection. Having the same risk and yield as common bonds, green bonds provide an added value, which exceeds financial aspects."
With an expense ratio of 0.35 per cent, ECBI is approved to be distributed in Germany, Austria, Italy and Luxembourg.
UniCredit's competitors Lyxor and VanEck have each issued a green bond ETF back in Q1 2017. The VanEck Vectors Green Bond ETF (GRNB) and the Lyxor Green Bond UCITS ETF (CLIM) have a positive 30-day yield of 1.66 per cent and 0.82 per cent respectively. The key difference between these two ETFs and the newly issued ETF being that GRNB and CLIM are comprised of both US and euro-denominated bonds as opposed to ECBI which is euro only. Additionally BlackRock issued a green bond ETF last month.