Green bond financing heading to 'stretch target' 10 July 2015 4:19PM Bernard Kellerman The global green bond market grew rapidly in 2014, with issuance of US$36.6 billion of green bonds, according to a new report from the Climate Bonds Initiative and HSBC on the state of the climate change capital funding market. 'Green bonds' has become a term loosely defined as applying to capital markets instruments used to fund projects that deal with aspects of mitigating climate change. As at June 10, 2015, total labelled green bonds outstanding were US$65.9 billion.Issuance of green bonds is expected to ramp up in the second half of 2015 with the build up to the UN Climate Conference in Paris at the end of the year. The London-based Climate Bonds Initiative expects total 2015 issuance to reach US$70 billion, with a stretch target for US$100 billion of issuance. The largest issuers of labelled green bonds to date are the European Investment Bank (US$11. 6 billion) and the World Bank (US$8 billion), with German development bank KfW (US$4 billion) propelling to third place after several large issuances in 2014 and 2015.Asia-based development banks have also issued labelled green bonds in the past year including the Asian Development Bank (US$500 million and ZAR US$25 million), and the Development Bank of Japan issuing the first Japanese green issuance (€250 million).Overall corporate issuance has increased, although early corporate bonds issued by GDF Suez (March 2014, €2.5 billion) and EDF (November 2013, €1.4 billion) have not been exceeded in size in the past year. More new issuers have entered, but they are bringing relatively smaller bonds (less than $1 billion) to market.