Innovation of Sustainable Financial Instruments and Corporate Financing Costs——A Study on the Issuance Premium of Transition-Linked Bonds
This paper studies the issuance premium of transition-linked bonds issued between 2021 and 2023 in China.The study finds that companies issuing transition-linked bonds can reduce their bond financing costs by 18.48 basis points(bps).Mechanism analysis indicates that issuer reputation,default risk and investor demand preferences are effective chan-nels that influence bond issuance premiums.The moderating effect shows that this premium is related to the special terms of transition-linked bonds and is mainly influenced by the type of key performance targets of the bonds,rather than the structural characteristics of the bonds.Heterogeneity analysis results indicate that the cost advantage of issuing transition-linked bonds is more significant in the eastern regions,provinces with higher levels of green finance development,and non-heavily polluting enterprises.
transition-linked bondfinancing costissuance premiumspecial terms of bond
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