Impact Report 2024

Bonds in Action:

Catalyzing Green Impact Across Latin America
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A Major New Bond Market Is Taking Shape

In the past years, we laid the groundwork for a growing green bond market in Latin America and the Caribbean. Today, increasing numbers of green bonds are being launched. This is a market with real momentum.

In a major year for the fund and market, our work in Peru and Guatemala was transformative.

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In Peru, building on a series of events, trainings, and a key report to promote thematic instruments, we celebrated a landmark achievement: we partnered with BanBif to issue Peru’s first subordinated thematic bond.

In Guatemala, with our support, Promerica Guatemala and BAC Guatemala issued the country’s first and second local thematic bonds. These bonds set a precedent and open the doors for future issuances.

We also expanded our efforts to develop and promote blue bonds aligned with pressing environmental priorities. Joining our existing investees Banco Internacional Ecuador and BBVA Colombia, we worked closely with Banco Nacional de Costa Rica to champion the issuance of Costa Rica’s first blue bond. This aligns with the government’s focus on sustainable water and coastal resource management, as well as responsible tourism.

The appetite for thematic bonds is growing across the region. We are proud to be a catalyst for this transformation. As the market matures, we remain committed to supporting innovative financial instruments that deliver both environmental and economic returns.

Johannes Scholl, Board Chair
Myriel Frische, Portfolio Manager

Content

Our impact so far

Portfolio and financial indicators1

Portfolio and financial indicators<sup>1</sup>
0
Co-investments2

Impact indicators3,4

0
Tons of CO2e emissions avoided per year
Equivalent to taking 5,400 cars off the road per year
0
M3 water treated/saved5
The yearly drinking water for 11,000 people
0
MWh renewable energy generated per year
Clean energy to meet the average yearly needs of 22,000 households in Guatemala
0
Tons of waste reduced, reused or recycled5
Equivalent of 6,200 garbage trucks
0
M2 sustainable construction financed5
Equivalent to the size of 3,800 parking spaces
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Breakdown

Funding per share class1

Use of proceeds (“UoP”)2

Green Use of Proceeds distribution by categories (82.5%)2

  1. Data from outstanding portfolio as at 31 Dec 2024.
  2. Total funding mobilized in bonds in which LAGreen invested, provided advice and/or built capacity.
  3. Data from reported portfolio as at 31 Dec 2024.
  4. Given the thematic focus of each bond, impact metrics are aggregated from bonds which have allocations to the sectors – commonly one to three bonds — rather than the entire cohort of bonds that have reported.
  5. Cumulative figures since the fund’s inception.

All currency data is in USD

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As a bond investor, the fund relies primarily on reporting made public by the issuers for attaining impact data. Impact KPIs are assessed and aggregated across the fund’s portfolio and displayed cumulatively since inception. Our in-house team of impact experts critically reviews the information made available by the issuers, before the data is applied to calculate the impact KPIs.

To consistently support the quality of impact reporting by issuers, and ensure solid data for the fund’s own assessments and reporting, LAGreen continuously offers programs to enhance issuers capacity to prepare impact reports and to develop methodologies in line with industry standards and scientific evidence to estimate impact.

// argentina > TODO: add "shape" class to make it clickable

Investing across Latin America

Bolivia
0
of advisory and capacity building project distribution
Brazil
0
of advisory and capacity building project distribution
Colombia
0
of investment portfolio
0
of advisory and capacity building project distribution
Costa Rica
0
of investment portfolio
0
of advisory and capacity building project distribution
Mexico
0
of investment portfolio
0
of advisory and capacity building project distribution
Panama
0
of investment portfolio
0
of advisory and capacity building project distribution
Ecuador
0
of investment portfolio
0
of advisory and capacity building project distribution
Peru
0
of investment portfolio
0
of advisory and capacity building project distribution
Honduras
0
of advisory and capacity building project distribution
Dominican Republic
0
of advisory and capacity building project distribution
Nicaragua
0
of advisory and capacity building project distribution
Paraguay
0
of advisory and capacity building project distribution
Guatemala
0
of investment portfolio
0
of advisory and capacity building project distribution
El Salvador
0
of advisory and capacity building project distribution
Data as at 31 Dec 2024
Data as at 31 Dec 2024

Impact Stories

Snapshots

Championing the first Peruvian subordinated thematic bond

In December 2024, we partnered with BanBif in its landmark issuance of Peru’s first subordinated thematic bond.

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Laying the ground for green transport

Together with the Colombian Stock Exchange and Climate Bonds, we launched the GSS+ Bonds Accelerator to support new issuers, delivering EU-backed training across Colombia on thematic bonds in the transport sector.

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Strengthening Colombia’s circular economy

We continue to support Colombia’s shift toward a circular economy by working with the financial sector to fund industry improvements—like Reciclene SAS, which upgraded its plastic-sorting machinery with a loan from our investee Banco de Bogotá.

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Advisory & Capacity Building

As new issuers enter this evolving bond market, our Advisory & Capacity Building service becomes even more critical.

This past year, we have enabled many first-of-their-kind bond issuances. But our work doesn’t end there. We collaborate with issuers throughout the issuance lifecycle and beyond.

One area of focus was in-depth impact reporting. We implemented a new impact reporting approach that helps issuers build the infrastructure to produce accurate reporting that is scalable, reliable and based on reputable frameworks. We are currently building this infrastructure with three issuers. We will continue to empower others in this area.

Advisory & Capacity Building featured highlights

May 2024
Jun 2024
Aug 2024

Successfully Supported Banco de Bogotá in Delivering a Robust Post-Issuance Report

  • Partner: LAGreen
  • Region: Latin America

Rolled Out a New Capacity-Building Approach for Impact Reporting

  • Partner: LAGreen
  • Region: Latin America

Launched the Mexico State of the Market Report on Sustainable Debt. Our Third Country-Specific Edition Following Peru and Colombia

  • Partner: LAGreen, Climate Bonds Initiative
  • Region: Latin America

How we manage impact

Smarter frameworks, stronger insights

After successfully publishing our first impact report last year, we continue to improve how we track impact.

In addition to taking inputs from issuers’ reporting, we continuously refine our impact methodologies to track outcomes across the Fund’s portfolio. These are rooted in scientific evidence and aligned with global best practices, ensuring our impact is both measurable and meaningful.

Contributing to a range of SDGs

Through investments in green and sustainable bonds in Latin America and the Caribbean, we channel resources to sustainable local projects that provide environmental and social benefits.

These projects support a wide range of Sustainable Development Goals (“SDGs”) through renewable energy generation, sustainable water use, resource efficiency and sustainable transport, among other projects.

For LAGreen’s priority SDGs, we have mapped our impact KPIs against specific SDG sub-targets under the ICMA High-Level Mapping to the Sustainable Development Goals.

Aligning with international standards and sustainable finance regulations

We build on the following international standards and applicable regulations, among others:

  • ICMA Principles
  • Climate Bond Initiative Guidelines
  • Operating Principles for Impact Management
  • IFC Performance Standards
  • Fundamental conventions of the International Labour Organization
  • International Bill of Human Rights
  • Disclosure in line with requirements stipulated by Article 9 of the Sustainable Finance Disclosure Regulation (“SFDR”).
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Finance in Motion, LAGreen’s Manager, has been recognized as a ‘Practice Leader’ by BlueMark since 2022. In 2023, its impact management system was rated ‘advanced’ – the highest possible – across all.

Positive impact management

Measuring positive impact helps us progress towards our impact objective and informs our strategy. We monitor our impact based on key indicators, in line with our Theory of Change, which reflects:

  • Environmental impact through the financing of sustainable projects
  • Support for scaling the thematic bond market in Latin America and the Caribbean

Read more about our Theory of Change here.

We integrate systematic impact measurements and management throughout our investment lifecycle. The fund relies primarily on bond impact reports published by issuers to attain data. Impact KPIs are assessed and aggregated across the portfolio. We have developed tailored tools that allow us to:

  1. Assess the potential impact of each investment at the due diligence stage
  2. Oversee the potential impact during the holding period
  3. Evaluate the final impact at maturity
  4. Monitor and manage portfolio-level impact

The Green Bond Tool

Finance in Motion developed its Green Bond Tool to improve impact assessment and management. It builds on LAGreen’s impact pathways and is aligned with industry best practices, including:

The tool analyzes key aspects of each investment alongside the fund’s contribution, building a holistic impact view that incorporates:

  • The issuer’s sustainability strategy
  • The issuance’s ability to deliver environmental impact
  • The issuer’s committed reporting practices
  • The fund’s engagement with the issuer and the market
Managing environmental and social risks

We prioritise managing – i.e., avoiding, minimizing, and mitigating – potential environmental and social (“E&S”) risks and negative impacts associated with our investments. To this end, we maintain and continuously improve our E&S management system.

Throughout our investment process, we consider E&S risks. Screening and thorough due diligence help identify E&S risks and assess the capacity and commitment of issuers to address and mitigate these. Once we have deployed capital, we monitor the E&S performance of our investments and engage with issuers wherever possible.

Shareholders

European Union KFW Federal Ministry for Economic Cooperation and Development

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