According to a staff climate paper published by the International Monetary Fund (IMF), catastrophe bonds are one of “the most prominent innovations in the field of sustainable finance in the last 15 years,” but the organisation believes more use of them is needed to cover burgeoning catastrophe and climate risks.
Catastrophe bonds sit alongside green bonds as the most prominent innovations in sustainable finance, according to the IMF staff paper.
However, the paper which is focused on sovereign issuance and use of climate debt instruments, concludes that issuance of cat bonds by sovereign actors is a relatively recent occurrence and could be more widespread.
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