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Wednesday, January 09, 2019, 14:50
Infrastructure bonds: AIIB to build US$500m credit portfolio
By Xinhua
Wednesday, January 09, 2019, 14:50 By Xinhua

In this Jan 14, 2016 photo, pedestrians walk past the headquarters of the Asian Infrastructure Investment Bank (AIIB) in Beijing, China. (PHOTO / IC)

BEIJING – The Asian Infrastructure Investment Bank (AIIB) said Wednesday its board of directors has approved US$500 million for a credit portfolio that invests in corporate bonds to finance infrastructure investment.

Vice-president DJ Pandian said AIIB can unlock “the greatest potential to mobilize private capital for infrastructure from institutional investors” with the portfolio

The managed portfolio will be comprised of corporate bonds issued by infrastructure-related issuers, including quasi-sovereign bonds and green bonds where proceeds are directed to sustainable infrastructure and other productive sectors, the AIIB said in a statement.

The portfolio "aims to develop infrastructure as an asset class, deepen debt capital markets for infrastructure and promote the integration of environmental, social and governance (ESG) principles in fixed-income investments in emerging Asia," the statement said.

READ MORE: AIIB's new strategy focuses on sustainable transport projects

Bonds purchased under the portfolio will be screened, assessed and managed based on the ESG investing principles, according to the statement.

With this portfolio, "we can unlock the greatest potential to mobilize private capital for infrastructure from institutional investors," said DJ Pandian, AIIB vice president and chief investment officer.

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"If only a small fraction of the trillions of dollars currently under management by institutional investors were allocated to infrastructure projects, there would be a catalyzing impact on emerging Asia's growth potential," said AIIB director general for investment operations, Dong-Ik Lee.

A multilateral development bank headquartered in Beijing, the AIIB began operations in 2016 and has grown to 93 approved members worldwide.

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