ADB – Green Investment Banks

The urgent need for sustainable finance and investment to meet climate targets and sustainable development goals has led to calls for a greater role for public financial institutions, particularly green investment banks (GIBs). These institutions can help bridge the gap in financing for activities with uncertain returns and positive externalities, which commercial banks may not provide. Public development banks, including multilateral and national ones, already play a critical role in driving investment in climate action, but there is a growing recognition of the untapped potential for these institutions to become GIBs. GIBs can facilitate private investment in green sectors through tailored financial structuring, addressing market failures and leveraging private finance for development. By working with governments to create favorable conditions for green investments and developing a pipeline of green projects, GIBs can drive the transition to sustainable development and help achieve climate and development goals, particularly in emerging markets and developing economies.