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Project finance 14 Jul 2017

BBVA signs the first green loan with a project finance structure worldwide

BBVA has signed the first green loan in the project finance format with the Italian energy company Terna. The funding has been structured into a loan A for 56 million dollars awarded by the Inter-American Development Bank (IDB) and a loan B for 25 million dollars entirely subscribed by BBVA, which has also headed the green structuring of the funding and acted as the Green Loan Coordinator.

The funding will allow Terna to build a transmission line between the cities of Melo and Tacuarembó in Uruguay, connecting projects for the generation of renewable energy to the country’s electrical grid and contributing to the fight against climate change and the achievement of the Sustainable Development Goals.

This loan has been structured as a green instrument in accordance with the Green Bond Principles based on the certification granted by Vigeo Eiris, a global provider of ESG services (environmental, social and corporate governance) for investors, private and public organizations and NGOs.

picture of Electricity tower

BBVA, a global leader in green financing

BBVA has the capability and the knowledge to provide its customers with top-quality advice on sustainable funding solutions in both bonds and loans, and is playing a key role in developing this market. The bank was the most active Spanish Bookrunner in the green bond market in 2016 and is a key player in the green loan market. It has closed several major transactions worldwide in 2017.

With this new green loan in the project finance format, BBVA expands its sustainable wholesale product range. The green loans market is expected to attract growing interest from issuers and financial institutions, who will increasingly be seeing higher quantitative and qualitative standards in terms of sustainability.

Ricardo Laiseca, Head of Global Finance, the business unit including both bonds and loans, expects green loans to see similar growth to that undergone by green bonds a few years ago. “That is why, at BBVA we seek to promote and enable sustainable investments that will gradually assume more importance within the banks’ investment criteria”, Laiseca claims.

About Terna

Terna is one of the largest independent transmission system operator in Europe with more of 72,000 km high voltage lines. Chaired by Catia Bastioli and directed by Luigi Ferraris, it is responsible for the transmission and management of electricity flows throughout Italy, maintaining a balance in the supply and demand for energy which the country needs to grow. It builds on its experience and on innovation to develop new business opportunities in Italy and abroad.

Thanks to its attention to sustainability and to its sound ESG performances, Terna is among the top companies of the Electricity sector in the main sustainability ratings and it is included in the main international sustainability indices such as Dow Jones Sustainability (World), FTSE4Good (Global and Europe), Euronext (World, Europe and Eurozone), STOXX® ESG (Global, Environmental, Social and Governance), STOXX® Low Carbon, ECPI, ESI (Ethibel Sustainability Index, MSCI, United Nations Global Compact (“GC100”).

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