The increase will be led by sovereigns, supranationals and agencies (SSAs), which are projected to grow issuance by around 8 per cent, while corporates are expected to rise by 7 per cent. Financial institutions, however, are likely to remain flat compared to last year.
Energy investments fuel demand
“Governments and companies across Europe face mounting pressure to strengthen domestic energy supply and resilience,” says Gregor Vulturius, Lead Scientist and Senior Advisor in SEB’s Climate & Sustainable Finance unit.
He says geopolitical tensions, the rapid expansion of AI-driven data centres and recent infrastructure attacks have highlighted the need for reliable power networks.
The EU’s Grid Package calls for energy infrastructure investments to increase by more than 40 per cent by 2029 to integrate renewables and improve efficiency.
A recent example is Amprion’s issuance of three green bonds totalling 2.6 billion euros euros earlier this month, in which SEB participated.
Amprion is one of the four major transmission system operators in Germany.
Public sector leads the way
Public institutions are expected to play a key role in the surge. German development bank Kfw plans to issue 15 billion euros in green bonds this year, up from 14 billion euros in 2025. The EU and other major borrowers have also signalled higher issuance, reinforcing expectations of a strong pipeline.
Refinancing adds stability
Around 200 billion dollars in sustainable bonds will mature in 2026. Assuming an 80 per cent refinancing rate, this could provide a baseline of 160 billion dollars in new issuance.
Efforts to promote transition finance, including new standards from authorities and standard-setting bodies, are unlikely to drive significant growth in sustainability-linked or transition bonds this year. Uptake of such instruments remains limited due to concerns over transparency and complexity.
Fact box: Key figures for 2026
- Green bond issuance forecast: 370 billion dollars
- SSA issuance growth: +8 per cent
- Corporate issuance growth: +7 per cent
- Estimated refinancing baseline: 160 billion dollars