Green bonds are debt securities issued to raise capital specifically to support climate related or environmental projects.
Fitch Ratings provides credit ratings for green bonds based on the underlying credit risk in line with relevant sector criteria. For specific issues, this includes standard credit considerations used to assess credit risk including vulnerability to default and an expectation of relative recovery rates in the event of default. Fitch does not assess the environmental integrity – the “greenness” – of the bond or its stated use of proceeds.