The Impact of the Novel Coronavirus Pneumonia Epidemic on the Green Bond Market: A Perspective on Yield and Issuance Size

Yujing Tang ()
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Yujing Tang: Dongbei University of Finance and Economics

A chapter in Proceedings of the 2024 4th International Conference on Enterprise Management and Economic Development (ICEMED 2024), 2024, pp 265-279 from Springer

Abstract: Abstract This study aims to empirically analyze the impact of COVID-19 on credit spreads and issue size of corporate green bonds and explores the role of factors such as bond type, issue duration and issue timing. The study empirically analyzed the COVID-19 epidemic using the least squares (OLS) method, and conducted multicollinearity and heteroskedasticity tests using the VIF test, the White test, and the Robust model, and enhanced the explanatory power of the model by introducing a dummy variable (bond category). It is found that COVID-19 significantly reduces the issuance cost of green bonds. Moreover, the issuance size of green bonds decreased after COVID-19, but this trend is no longer significant after controlling for bond category. It indicates that different types of green bonds are affected by the epidemic to different degrees. In addition, longer issuance maturities are associated with larger issuance sizes. Moreover, large-scale issuance helps to reduce credit spreads. This study reveals the complex impact of COVID-19 on the green bond market and provides empirical evidence for the development of issuance strategies for green financial products.

Keywords: Green bonds; COVID-19; Credit spread; Issuance size (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-506-5_30

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DOI: 10.2991/978-94-6463-506-5_30

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