Analysis: ‘Greenium’ shrinks as climate bond sales swell to record

Investors have long paid a premium to get hold of scarce green bonds, but record issuance might be about to change that.

Bonds sold to fund environmentally-beneficial projects have tended to command higher prices and lower yields than conventional bonds. But that differential — dubbed the greenium — all but vanished in April in the euro corporate bond market.

Comparing option-adjusted credit spreads on an index of euro green bonds with a comparable index of conventional bonds, the Association for Financial Markets in Europe, an industry body, found investors in April paid virtually no…