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8 Dec 2021 – Articles

Danske Bank is helping Danmarks Nationalbank issue its first green bond

Danske Bank is helping the central bank of Denmark issue Denmark’s first green bond. The bond will support the green transition by funding green investments and expenditures.



Denmark will soon move an important step closer to reaching its ambitious climate plan.

Danmarks Nationalbank will issue Denmark’s first green government bond in January, which will be allocated to green expenditures and investments undertaken by the central government.

The green government bond is the first of its kind in Denmark, and will be issued with i.a. Danske Bank as advisor.

“We are pleased to help Danmarks Nationalbank issue its first green bond as it will bring more finance to green investments and thereby support the transition towards a greener society,” says Claus Harder, Global Head of Markets & Transaction Banking at Danske Bank.

Renewable energy and clean transportation
The green bond is issued in accordance with the Kingdom of Denmark's Green Bond Framework, which describes the criteria governing which expenditures are eligible to be financed by the green bond.

The production of wind and solar energy and the green transition of the Danish transport sector are among the expenditures that the green bond will finance.

We are pleased to help Danmarks Nationalbank issue its first green bond as it will bring more finance to green investments and thereby support the transition towards a greener society.

Claus Harder

Global Head of Markets & Transaction Banking, Danske Bank



The Twin bond concept
The issuance of green bonds has been on the rise in global debt markets for several years. A trend that is spreading to sovereign issuers around the world including Danmarks Nationalbank.   

“One of the advantages of issuing a green bond is the increased demand from investors resulting in better borrowing conditions for the issuer compared to a conventional bond,” Gustav Landström, Global Head of SSA Origination at Danske Bank, explains. He elaborates

“In this case, the green bond will be issued together with a conventional governmental bond. This is called a Twin Bond structure which will make it possible to issue green bonds without compromising the liquidity in conventional Danish government bonds,”.

The Danish Twin bond is line with the twin bond concept introduced by Germany in 2020 and investors will have the opportunity to switch the 10-year green twin bond to the corresponding and more liquid conventional 10-year twin bond one-to-one. However, investors will not be able to switch the conventional twin bond to the corresponding green twin bond.

The expected issuance volume will be announced in connection with the announcement of the central government's borrowing strategy in December.

What is a green bond?

Green bonds are bonds that exclusively finance projects providing a clear environmental benefit.

The eligible green categories are defined in the issuers Green Bond Framework and the projects can for instance include renewable energy, pollution prevention and energy efficiency.