The sustainable bond market in the ASEAN+3 region experienced significant growth in the third quarter, with outstanding sustainable bonds reaching USD893.1 billion by the end of September, according to data collected by the Asian Development Bank’s Asia Bond Monitor.
The size of the region’s sustainable bond market in the third quarter is a growth of 4.1 percent from the previous quarter, outpacing the expansion recorded by both the European Union (EU-20) and the United States, 1.9 percent and 1.2 percent, respectively, during the same period.
Asia Bond Monitor traced the growth to the increased bond issuance amid improved financial conditions, particularly following monetary easing in both advanced economies and many regional markets. The share of ASEAN+3 of the global sustainable bond market rose slightly to 18.9 percent at the end of the third quarter, up from 18.7 percent in the previous quarter. Despite this growth, ASEAN+3 remains the second-largest regional sustainable bond market, behind the EU-20, which holds a 36.4 percent global share.
Hong Kong and the ASEAN region posted the fastest quarter-on-quarter expansions, growing by 11.6 percent and 9.2 percent, respectively. The private sector dominates ASEAN+3’s sustainable bond market, accounting for 70 percent of outstanding bonds, compared to just 25.4 percent in the broader bond market. This contrasts with the EU-20, where the private sector’s share in sustainable bonds is slightly lower, at 50.8 percent.
ASEAN+3’s sustainable bond issuance during the third quarter surged to an all-time high of USD73.7 billion, representing a 42 percent increase from the previous quarter. This growth outpaced global sustainable bond issuance, which grew by just 3.3 percent. ASEAN+3 now holds a 31.9 percent share of global sustainable bond issuance, up from 23.2 percent in the second quarter. China was the region’s largest issuer of green bonds, while South Korea led in social bonds, and Japan dominated sustainability-linked bonds.
The ASEAN+3 market remains focused on short- to medium-term financing, with 74 percent of bonds issued in the third quarter having tenors of five years or less. With increasing participation from both the public and private sectors, the ASEAN+3 region continues to play a pivotal role in the global sustainable bond market, supporting the transition to a greener, more sustainable economy.
