By the Law of 22 June 2018, the Luxembourg legislator
introduced renewable energy covered bonds through a modification of
the relevant provisions of the Law of 5 April 1993 on the financial
sector, as amended ("LFS").
Renewable energy covered bonds are a new covered bonds class in
the LFS, testifying the innovative attitude which Luxembourg adopts
in this area, the development of green finance being part of the
diversification strategy for the financial sector and the
Luxembourg economy. Hence, new opportunities for covered bond banks
in Luxembourg are created.
Further, several changes strengthen the existing legal framework
for the issuance of covered bonds.
Renewable energy covered bonds are covered bonds backed by loans
secured by rights in rem or by charges on immovable or movable
renewable energy property and by step-in rights into the material
contracts of the financed project. They present a high quality
standard since any material property linked to the
