The outstanding value of bonds issued on Taiwan’s Sustainable Bond Market (SBM) has hit a new high to surpass NT$300 billion (US$10.17 billion), the Taipei Exchange (TPEx), which runs the local bond market, said Thursday.
As of May 4, the outstanding bonds on the SBM totaled NT$302.6 billion with a total of 100 tranches of bonds, which was also a record high, circulating on the market, the TPEx said.
The TPEx operates the SBM, which comprises green, social and sustainability bonds in an integrated listing and trading mechanism, as part of its efforts to promote corporate sustainability.
After the issuances of about NT$100 billion worth of bonds on the SMB in 2021, Taiwanese enterprises either continued their bond sales or sold their bonds for the first time on the SMB since the beginning of this year with about NT$41.29 billion in bonds listed on the board.
Among the enterprises selling bonds on the SMB is Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, which issued two tranches of green bonds valued at NT$5.4 billion so far this year after the sales of three tranches of green bonds worth NT$12 billion.
Vanguard International Semiconductor Corp., a smaller contract chipmaker in Taiwan, issued one tranche of green bonds worth NT$1 billion earlier this year to boost the total of its green bond sales to NT$1.7 billion.
Chunghwa Telecom Co. and Far Eastone Telecommunications Co., two of the leading telecom service providers in Taiwan, were first-time participants in the SBM this year, issuing NT$3.5 billion worth of sustainability bonds and NT$2.7 billion worth of social bonds, respectively, according to the TPEx.
So far this year, local non-financial enterprises have become more active in the SBM by issuing NT$12.6 billion worth of debt, up 500 percent from a year earlier, indicating they have become more willing to take action to support corporate sustainability and transform their operations, the TPEx said.
The TPEx said these local non-financial debt issuers accounted for about 31 percent of the total bond sales on the SBM so far this year, while local financial institutions and foreign issuers made up the remaining 69 percent.
Green bonds, promoted by Taiwan’s capital markets and financial authorities, are aimed at encouraging companies to act in an environmentally responsible way, with the proceeds going to eco-friendly projects.
Social bonds are debt instruments that raise money for social projects such as gender equality initiatives, while sustainability bonds are a combination of green bonds and social bonds and are used to finance projects that bring environmental and socio-economic benefits.
Source: Focus Taiwan News Channel