At the recent launch of the new International Capital Markets Glossary for 2025, panellists discussed markets trends for the year, which reflect a dynamic and rapidly changing environment. As more issuers navigate the complexities of the market and explore new opportunities, we likely can expect continued innovation and growth in this sector.

EU Green Bond Standard

The EU Green Bond Standard (EUGBS), which came into force in December  2024, has already made a significant impact on the market. This new standard is considered by many to be the gold standard due to its stringent alignment requirements with the EU taxonomy. Unlike most other bonds that comply voluntarily with the International Capital Market Association (ICMA) guidelines, the EUGBS sets a higher bar for issuers.

Surprisingly, the market has already seen its first two bonds issued under the EUGBS this year. This rapid uptake was unexpected, as many anticipated a slower start with the first issuances not appearing until mid-year. The complexity and onerous nature of the EUGBS were expected to delay its adoption, but the early issuances suggest a strong interest and readiness among issuers.

While the market for green bonds is well-established and deep, it remains to be seen if the EUGBS will offer any extraordinary pricing benefits that could attract more issuers. For certain issuers, particularly those in the sovereign, supranational, and agency (SSA) sectors, there may be physical incentives to adopt the EUGBS. Looking ahead, there appear to be more issuances in the pipeline, indicating that the EUGBS could capture a notable share of the proceeds market. The early issuances in January were unexpected, but they signal a growing interest and confidence in the new standard.

IPOs and listings

In addition to the developments in the green bond market, significant trends are emerging in capital markets, particularly regarding IPOs and listings. The interest in US listings has increased, with many companies considering dual listings in both the US and Europe. This trend is driven by the desire to tap into the deep and liquid US capital markets, which can offer greater visibility and potentially higher valuations.

The approach to capital raising is also evolving. Companies are increasingly opting for direct listings and syndicated methods, moving away from traditional partnerships. This shift is partly due to the need for de-risking capital and returning to more conventional methods of raising funds. The capital markets are seeing a return to practices that were more common before the recent wave of innovation and disruption.

To ensure you are prepared for your next capital markets deal, download the International Capital Markets Glossary 2025.