European Union
A practitioner’s overview of the 2025 LMA Transition Loan Principles and ICMA Climate Transition Bond Guidelines
Key Aspects
- Growing significance of establishing financial labels to support the transition towards sustainability.
- The APLMA, LMA, and LSTA publish the "Guide to Transition Loans," introducing a dedicated label alongside existing green loans, social loans, and sustainability-linked loans. This label adheres to principles similar to those guiding green and social loans, with adjustments tailored specifically for transition purposes.
- ICMA introduces the "Climate Transition Bond Guidelines" as part of its suite of GSSS+ labels. These guidelines leverage the foundational features of green and social bonds, adapted to address transition-specific requirements.
- Both highlight the importance of placing labelled financial products in the context of credible transition plans and/or strategies.
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