Investment Opportunities Open Up with Gunma Prefecture's Green Bond Initiative

Gunma Prefecture, under the leadership of Governor Ichita Yamamoto, is set to launch a new series of Green Bonds in July 2026. These bonds will be available for purchase at three local branches of Daiwa Securities, along with various other outlets nationwide. This is an exciting opportunity for corporate investors looking to contribute to sustainable projects while potentially enhancing their investment portfolios.

What Are the Green Bonds?

The latest issuance comprises two types of bonds: a 10-year bond worth 10 billion yen and a 5-year bond valued at 5 billion yen, making a total issuance of 15 billion yen. Each bond can be acquired starting at a minimum investment of 10 million yen. Successful investors will also have the opportunity to express their commitment to the environmental projects backed by these bonds.

An investment declaration is not only a show of support for the environmental initiatives funded by the bonds but will also grant these investors visibility on Gunma Prefecture's official website, highlighting their commitment to sustainable development.

Focus on Sustainability

Launched in alignment with the “Gunma Five Zero Declaration” initiative, these Green Bonds are part of the prefecture’s broader strategy to foster economic and environmental synergy. The previously issued bonds have already funded various projects aimed at energy efficiency, disaster management, and environmental preservation.

This fourth issuance is particularly significant as it continues to support Governor Yamamoto’s vision for a sustainable Gunma by allocating funds for activities such as energy renovations in public facilities, environmental enhancements at national parks like Oze, and flood control measures.

Projects Funded by Green Bonds

The bonds are geared towards financing several key projects:

- Energy Efficiency: Upgrading energy systems within public buildings.
- Ecological Management: Enhancing roadway systems and preserving natural resources in areas like Oze National Park.
- Biodiversity Conservation: Improving buffer zones along rivers to protect aquatic ecosystems.
- Climate Adaptation: Implementing measures for flood control, including reservoir constructions and landslide prevention operations.

This initiative represents an important shift in how investment can directly contribute to climate action and local community development. By participating, corporate investors will not only enhance their green credentials but will also actively support Gunma’s transition to a low-carbon economy.

Purchase and Investment Declaration Details

Institutions such as corporations, foundations, and municipalities can take part in this investment opportunity. Interest parties are encouraged to reach out to Daiwa Securities for comprehensive information about bond details and the buying process.

The securities are planned for issuance in July 2026, with final terms to be confirmed in early July. Prominent underwriters include Daiwa Securities, Nomura Securities, and SMBC Nikko Securities. Investors will receive confirmations regarding their contributions and the project's impact on environmental and social conditions.

Furthermore, those who submit an investment declaration will be recognized online, aligning with the prefecture's efforts to promote transparency and community involvement in sustainability initiatives.

Regulatory Compliance and Investor Considerations

Daiwa Securities has confirmed that the bonds align with the International Capital Market Association (ICMA) Green Bond Principles 2021, receiving a positive evaluation from the Rating and Investment Information, Inc. (R&I), a third-party organization. This compliance is essential to ensure that funds are used efficiently to achieve the intended environmental objectives.

Investors should be aware of associated fees and risks, including potential fluctuations in interest rates and exchange rates for foreign securities. Understanding the specifics of each bond and potential market changes will be crucial for making informed investment decisions.

As we move forward, the collaboration between Gunma Prefecture and Daiwa Securities marks a noteworthy milestone in public-private partnerships aimed at addressing climate issues while facilitating economic growth. With the introduction of these Green Bonds, Gunma Prefecture not only promotes environmental responsibility but also engages the investment community to create a sustainable future.

For detailed information and inquiries regarding the Green Bonds, please contact your nearest Daiwa Securities office directly.