<p>Yes, if green bonds are accepted as collateral they become more valuable/demanded by prospective buyers. When ECB directly buys these as part of QE then again they are more in demand. When demand shifts to the right and supply stays the same price increases.</p>
<p>In real life, ECB could just buy these green bonds on the market as part of their QE, for example, they could directly buy <a href="https://www.enel.com/investors/investing/sustainable-finance/green-bonds" rel="nofollow noreferrer">Enel Green Bonds</a>, that increase in demand will raise their prices so when Enel issues new Green Bonds they can charge more for them than they face value.</p>

CC BY-SA 4.0
2020-12-04T15:17:52.833Z
2020-12-04T15:17:52.833Z
csilvia
<p>For instance, the ECB accepts green bonds as collateral. And also they are more likely to include green bonds in a QE program.</p>
<p>Does this face make a green bond more valuable? How would it work in a real life example?</p>

<central-banking><debt><bonds><quantitative-easing>
How does QE effect the collaterals?
curiousTrader
# How does QE effect the collaterals?

(Asked by: username_0 on 2020-12-04)

For instance, the ECB accepts green bonds as collateral. And also they are more likely to include green bonds in a QE program.

Does this face make a green bond more valuable? How would it work in a real life example?

**Tags:** central-banking, debt, bonds, quantitative-easing

---

## 1 answers

### Answer by username_1 on 2020-12-04. Score: 2 | Accepted answer

Yes, if green bonds are accepted as collateral they become more valuable/demanded by prospective buyers. When ECB directly buys these as part of QE then again they are more in demand. When demand shifts to the right and supply stays the same price increases.

In real life, ECB could just buy these green bonds on the market as part of their QE, for example, they could directly buy [Enel Green Bonds](https://www.enel.com/investors/investing/sustainable-finance/green-bonds), that increase in demand will raise their prices so when Enel issues new Green Bonds they can charge more for them than they face value.


---

