The Kyrgyz Stock Exchange (KYSE) in Bishkek has expanded its list of verifiers to include S&P Global Ratings, who will conduct an independent assessment of sustainable finance instruments. The audit is centered on the evaluation of bonds aimed at green, social and sustainability (GSS) initiatives, according to a report on the KYSE website.
According to KYSE stakeholders, the participation of the high-profile rating agency gives investors who want to help GSS projects in Kyrgyzstan an opportunity to get an independent analysis and guarantees of sustainability of financial instruments on the exchange. The so-called Second Party Opinion will serve as a guarantee that investors’ money will be spent on environmental, climate, social and other projects related to sustainable development.
“The participation of a world-famous American company in KYSE activities will help attract the attention of international investors to Kyrgyz companies placing their green bonds. It will also create an incentive for Kyrgyz businesses to participate in these projects,” Irina Ivanova, head of KYSE’s sustainable development department, told the Times of Central Asia.
In addition to the U.S. rating agency, KYSE’s list of international appraisers includes several companies from Russia and Kazakhstan.
Earlier this year, the Kyrgyz Stock Exchange created a portal for issuing green bonds on its platform, so that foreign investors could participate in financing environmental projects in the country on market terms. According to participants of the exchange, large global companies are now changing their strategies in favor of socially responsible policy and investing in green projects — and an instrument like green bonds can serve as a driver for attracting foreign investment in the country.
For example, in Kazakhstan the total market value of sustainable finance is $257m, of which the market value of green finance is $188m — and green bonds comprise 65% of that amount. The advantages of such bonds are increased demand and trust from investors, which also has a positive impact on the rating of the issuer.
Several commercial banks in Kyrgyzstan have already placed the first so-called gender bonds on the KYSE at a total amount of 114 million Kyrgyz som ($1.3m) to finance women’s entrepreneurship projects in the country.
