LuxSE CEO Robert Scharfe, pictured in an archive image taken in Macau in January 2020
Photo: LuxSE handout
The Luxembourg Stock Exchange will announce on Tuesday the listing of the first social bond under the EU’s instrument for temporary Support to mitigate Unemployment Risks in an Emergency (SURE) programme.
The €17bn bond is the first of its kind to fall under the SURE programme, which was established earlier this year as a response to protect workers and jobs across Europe in the covid-19 pandemic and the resulting economic fallout. The programme’s mandate includes the borrowing of a maximum of €100bn on capital markets to deal with such consequences.
“We are extremely proud to celebrate the listing of the SURE social bond on our exchange and its display on LGX, our platform dedicated exclusively to sustainable securities,” Robert Scharfe, CEO of LuxSE, said in a press statement. “This bond raises funds to secure hundreds of thousands of jobs in multiple member states.”
He further called the issuing “an important milestone not just for Europe, but for sustainable finance.”
The bond has two tranches: €10bn with a 10-year maturity, and €7bn with a 20-year maturity.
According to European Commissioner for budget and administration, Johannes Hahn, “this instrument enables quick financial support for social matters, especially in the area of employment which is heavily affected by the crisis. The issuance of social bonds demonstrates the EU’s firm commitment to foster sustainable finance also at global level.”
To date under the SURE programme, 17 member states have received €87.8bn to protect their respective economies.
Earlier in October, the European Commission also established a social bond framework, issued under the EU debt issuance programme with the bond governed by Luxembourg law.
A live streaming of the listing is expected to be available on Tuesday via Luxembourg for Finance’s livestream of the Sustainable Finance Forum, taking place on 27-29 October.