'Green Bonds - Made by KfW' convince investors

Frankfurt (ots) -

- KfW successfully issues largest Green Bond ever with a volume of
EUR 1.5 bn
- Strong demand of socially responsible investors
- Positive feedback paves the way for further Green-Bond-issues

KfW debuts today with a new product in the capital market: KfW
issued its inaugural Green Bond. A Green Bond is an interest-bearing
security whose issue proceeds are used to finance environmental and
climate protection projects.

The first 'Green Bond - Made by KfW' was issued with a volume of
EUR 1.5 bn and is thus the largest Green Bond ever at the time of
issuance in this segment; it has a maturity of 5 years and pays an
annual coupon of 0.375%. Crédit Agricole, Deutsche Bank and SEB
jointly act as lead managers of the transaction. Underlining the
overwhelming interest by investors, the orderbook grew rapidly,
reaching EUR 2.65 billion within a short period of time. The high
granularity of the orderbook is particularly impressive: 90 investors
participated in the Green Bond with an average ticket size of below
EUR 30 mn.

"The issuance clearly shows that we hit the mark with our
sustainable investment offering - our first Green Bond is a huge
success. Especially the high degree of transparency and the
unprecedented quality standards of our Green-Bond-concept convinced
the investors", Dr. Günther Bräunig, member of KfW's Executive Board
and responsible for capital markets summarises the results of the
investor meetings, which took place in Europe in preparation of the
issuance.

With the 'Green Bond - Made by KfW', KfW directly connects its
financing of climate protection projects and the capital market for
the first time. Investors benefit from the excellent credit and
sustainability ratings as well as from the liquidity of KfW bonds,
and simultaneously support climate and environmental protection.

The bond proceeds are linked to KfW's environment investment
program, "Erneuerbare Energien" ("KfW Renewable Energies Programme -
Standard"). Thus, it is transparent to the investors that their
capital invested is used to finance projects for the generation of
power especially from wind and photovoltaics. Past results show that
an investment of EUR 1 million results in a greenhouse gas reduction
of 800 tons per year on average.

The positive and sustainable effects on the environment are
certified by the independent, non-profit Center for Solar Energy and
Hydrogen Research, Baden-Württemberg (ZSW). Furthermore, the
qualified, independent research centre CICERO reviews and evaluates
KfW's Green-Bond-concept. These high market standards convince many
investors.

"Generating profits and undertaking social responsibility at the
same time, represents a traditional principle at Union Investment. We
highly value that a 'green investment' is sustainably verifiable.
Therefore, we are glad that KfW expands the investment opportunities
with its innovative Green-Bond concept", confirms Jens Wilhelm,
member of the Executive Board and responsible for capital markets at
Union Investment.

"As an asset manager for the insurance industry, we consider
lasting returns and sustainability as interdependent. Both are
indispensable when dealing prudently with risk. So I welcome the
KfW's initiative to issue Green Bonds", affirms Dr. Thomas Kabisch,
CEO of MEAG.

During the tenor of 'Green Bonds - Made by KfW', the use of
proceeds is subject to ongoing monitoring and will be published
quarterly on KfW's website - this ensures high transparency for the
investors.

The market for Green Bonds has grown considerably and almost
doubled in size in 2014. KfW contributes significantly to take Green
bonds out of the niche and into the broader market - investors
appreciate these efforts. Cecilia Reyes, CIO of Zurich Insurance
Group comments: "Zurich is pleased with KfW's robust support for the
growing green bond market as an issuer, given their strong
sustainable development track record and credit quality. We are
especially impressed by the reporting framework put forward. It
allows direct impact attribution and sets a market example we highly
welcome".

The huge success of its inaugural Green Bond issuance is pointing
the way ahead for KfW's future activities in this market segment. "We
intend to intensify the strategic dialogue about 'responsibility in
the capital market' with our investors. Due to the positive feedback
by the investors, a second green bond in our other core currency USD
seems conceivable later in the year", explains Bräunig.

Service:

KfW EUR Green Bond I/2014 - Details

ISIN: XS1087815483
WKN: A1X3E7
Issuer: KfW
Guarantor: Federal Republic of Germany

Rating:

- Aaa - stable (Moody's)
- AAA - stable (S&P)
- AAA - stable (Fitch)

Sustainability Ratings (as of June 30, 2014):

- Imug: 1. out of 126
- Oekom Research: 3. out of 23
- Sustainalytics: 5. out of 191

Size: EUR 1.500.000.000
Tenor: July 22, 2014 - July 22, 2019
Coupon: 0.375%
Issue price: 99.473%
Yield: 0.482%
Listing: Luxembourg

Detailed information regarding the Green-Bond-concept, the use of
proceeds of "Green Bonds - Made by KfW" and the independent
third-party opinions are available at www.kfw.de/greenbonds.

DISCLAIMER

The information contained in this document does not constitute an
offer of securities for sale in the United States. Securities may not
be offered or sold in the United States absent registration or an
exemption from registration. KfW has not registered the securities
that are the subject of this document for sale in the United States.

Contact:
KfW, Palmengartenstr. 5 - 9, 60325 Frankfurt
Kommunikation (KOM), Nathalie Cahn,
Tel. +49 (0)69 7431 2098, Fax: +49 (0)69 7431 3266,
E-Mail: presse@kfw.de, Internet: www.kfw.de