Around the world, a growing number of countries are exploring green banks—financial institutions or facilities dedicated to accelerating the shift to a sustainable economy. State of Green Banks 2020 is the first aggregation and analysis of this activity, based on novel data collected from existing and emerging green banks in mid-2020. Although green banks are well established in some countries, and over two dozen countries are actively exploring the model, until now there hasn’t been a singular source of information about existing green banks and the progress of new institutions.
Green banks can take different forms, but all are motivated by a public purpose—accelerating low-carbon, climate-resilient, and sustainable development. They can help countries secure climate finance and deploy capital into new markets and technologies. They can help international financial institutions align their portfolios with the Paris Agreement and the Sustainable Development Goals. And they can help domestic financial institutions understand the value of investing in sustainable projects and transitioning to a green financial system.
As the focal point for a country’s climate finance, a green bank can tap into new sources of domestic capital (e.g., pension funds and sovereign wealth funds) and international capital (e.g., multilateral development banks and climate funds). Analysis in this report shows that existing green banks have been able to use their limited, often public, initial capital to mobilize many multiples of additional private investment.
The State of Green Banks 2020 report showcases trends among both operational and emerging green banks. It includes an analysis of 61 institutions in 36 countries based largely on the data the report authors gathered through surveys and interviews, as well as on additional desk research. The report highlights successes, trends, and lessons learned from existing green banks and presents trends in countries seeking to set up new green banks. These trends include the technologies they will invest in, types of financial instruments they will deploy, capitalization strategies, and obstacles green bank champions face during the establishment process.