Business and financial markets information service provider Bloomberg announced the launch of the Bloomberg U.S. Municipal Impact Index, aiming to track the market of U.S. Green, Social, and Sustainability-categorized municipal bonds.
According to Bloomberg, the new index is the first standardized measure of the U.S. municipal tax-exempt investment grade impact bond market.
Carved out from Bloomberg’s flagship Municipal Index, and utilizing the company’s data and research to individually vet and categorize municipal bonds as green, social or sustainable, the new benchmark tracks more than 2,800 securities. According to Bloomberg, in order to be included in the index, bonds must either be self-labeled as Green, Social or Sustainability directly from an initial offering, reviewed by independent assurance providers, or use 100% of proceeds for a project in line with the International Capital Market Association (ICMA) Principles.
Nick Gendron, Global Head of Fixed Income Index Product at Bloomberg, said:
“Investor demand for municipal impact bonds has been growing and its market value has more than doubled in the last three years, but participants have lacked a standard reference point for ESG-adherent securities. We believe the Bloomberg U.S. Municipal Impact Index will hold broad appeal for both ETF product creation and traditional benchmarking while also providing a useful tool for in-depth research of this growing segment of the municipal bond market.”