NAIROBI, Feb. 4 (Xinhua) -- Kenya is on course to issue a green bond by end of 2019, a bankers' lobby said on Monday.
Habil Olaka, CEO Kenya Bankers Association (KBA), told journalists in Nairobi that the industry is pushing for the floating of a green bond because it makes sense.
"Looking at the environmental, social and financial needs of both the country and the banking sector there is no better instrument to achieve sustainability like the green bond," Olaka during the rebranding of Remu Microfinance Bank to Key Microfinance Bank.
He said that given Kenya's level of economic development, it is prudent for the financial sector to prioritize sustainability.
He noted that the green bond will be floated at the Nairobi Security Exchange under the Sustainable Finance initiative.
According to KBA, there are currently three different initiatives that are working in parallel to develop a green bond. "Each of the initiatives have an equal chance of producing Kenya's first green bond," Olaka said.
He added said that either an individual bank or several banks with a special purpose vehicle or a client of bank will be supported to issue a green bond which will be championed by the entire industry.
He added that actual size of the green debt instrument will be determined by the appetite of green investors.
Olaka said that the proceeds of the bond will go towards purchasing green assets that will help Kenya to mitigate or adapt to the effects of climate change.
The CEO said that the government is supporting the issuance of green bonds through a number of tax incentives.