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Solactive and UBS unveil ESG development indices

German index provider Solactive and UBS have launched a suite of benchmarks targeting debt from the World Bank and other high-grade development banks.

The Solactive UBS Development Bank Bond Index family is composed of 36 total return indices designed to mirror the performance of US dollar-denominated bonds issued by development banks.

It follows JP Morgan and BlackRock’s launch of a suite of environmental, social and governance fixed-income indices.

The Solactive and UBS indices are subdivided into three groups: indices covering bonds issued by development banks, bonds issued by multilateral development banks, and bonds issued by the World Bank. Shorter maturities versions of the indices are available.

The indices are denominated in four different currencies, Swiss francs, euros, sterling and US dollars. Composition is market-cap-weighted and readjusted monthly. The family will be expanded to also include price return and hedged versions of the indices.

Steffen Scheuble, chief executive officer of Solactive, said indices were critical in attracting capital to sustainable development, enabling investors to gain efficient, standardised access to relevant instruments and helping to deepen liquidity and issuance.

Axel Weber, chairman of UBS Group, added: “Indices for World Bank and other highly rated development bank debt enable investors to allocate more to sustainable high-grade debt overall. They also help development banks fund their activities.”

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