ESG Syndicated Loans: Trends and Growth Drivers

Anna Baraulina, Syndicated Loan Reporter, Loan Radar

Inma Rabasco, Data Analytics Manager, Loan Radar

Activity is picking up!

While in H1 2024 sustainability-linked and green loans volumes slightly decreased year-on-year, the beginning of Q3 2024 was quite active, which led to change of trend – as of end of August ESG loans (SLL+Green) are not only consistent with the same period of 2023 but even higher, thanks to increased volumes of SLL.

Source: Loan Radar

ESG loan volumes have fluctuated between 19% and 27% of the total syndicated loan volumes quarterly since the start of 2023, with the July-August 2024 seeing a lower share of around 21%.

*Q3 2024 includes July and August only

Source: Loan Radar

The 2024 ESG lending growth has been driven by North America and Asia Pacific*

*Based on the information about deals signed in January-August 2023 & January-August 2024

Source: Loan Radar

Financial/Non-Financial

The dynamics have been different for Financial companies whose ESG borrowings nearly doubled, compared to Non-Financial companies, whose ESG loans saw only a slight increase. This situation has changed since 2023, when both segments decreased notably in January-August vs the same months months of 2022.

*January-August for every year

Source: Loan Radar

Currencies breakdown*

USD-denominated loans are leading the market followed by EUR-denominated loans, while the share of borrowings in other currencies in the total loan volumes has slightly declined.

*Based on the information about the deals signed in January-August 2023 & January-August 2024

Source: Loan Radar