Financing through the supply-driven green bonds market has significantly surged in recent years. In this paper, we examine the factors influencing the size of financing though green bond supply, using cross-section OLS regressions on a global dataset for 8 years (2010–2017) sourced from Bloomberg. We consider a set of tridimensional factors: bond characteristics, issuer characteristics, and market characteristics and examine their effects on issue size. Alongside whole sample estimation, we produce year-wise estimations to realize the evolution and persistence of the effects over time. We then produce estimates across rating grades of the bonds. Finally, we carry Blinder–Oaxaca decomposition to see if average issue size has significantly changed over time and whether the factors considered can explain the difference. We find a large number of factors affecting issue size asymmetrically; however, many of the effects do not persist over time and are heterogeneous across rating grades. In contrast to the aggregate market trend, we find no evidence of increases in average issue size in the recent year. Furthermore, the average financing size is found significantly lower for high-grade bonds. The paper provides a basis for encouraging green bond supply, particularly considering the rating of the bonds and the issuers.
Green bonds could play a key role in financing the investment needed to achieve the global climate and energy objectives and the UN Sustainable Development Goals. Using Bloomberg data of corporate green bond issuance from 2010 to 2017, we explore the factors affecting the size of borrowing. By employing a set of tri-dimensional elements (security characteristics, issuer characteristics, and market characteristics), we investigate the consistency of the effects across emerging and non-emerging markets. Findings suggest that, in general, issue size is positively related coupon rate, credit rating, collateral availability, and issuer’s sector and financial health. Moreover, issuances in emerging markets with a more international orientation and denominated in EURO, have a higher size. Arguably, these features make bonds more reliable, secured, and return-generating for investors, which facilitates higher issue size through greater investor demand. The paper calls for policies and incentives to encourage impact borrowing through increased green bond supply.