The projects financed with green bonds issued by BBVA in 2018 and 2019 avoided a total of 724.000 tons in CO2eq atmospheric emissions, almost three times than the previous year. This amount is equivalent to what more than 285,000 cars emit in one year, thus contributing to reduce the carbon footprint. This is one of the key takeaways of BBVA’s green bond report.
In 2019, the sectoral distribution of the bonds' proceeds was expanded to new sectors such as energy efficiency and waste and water management, on top of renewable energy and sustainable transportation. Specifically, BBVA devoted a total of €1,282 million to finance renewable energy projects, which allowed avoiding atmospheric emissions totaling 646,976 tons of CO2 in 2019 and with a total generation of 2,300 GWh of electricity per year. Also, a total of €468 million were allocated to sustainable transportation, which avoided a total of 75,957 tons of CO2 in atmospheric emissions.
Through these green bonds, the company funneled close to €190 million to a number of energy efficiency projects, which avoided a total of 1,073 tons in CO2 emissions. Also, a total of €94 million were allocated to waste management projects and €53 million to water management. The projects financed with BBVA’s green bonds allowed treating a total volume of water of 6,964,065 m3, equivalent to the annual water consumption of more than 140,000 people in Spain, and to manage a total of 292.514,514 tons of waste, equivalent to the amount generated by 600,000 citizens in one year
Funding these projects through the issuance of green bonds, BBVA is contributing to the achievement of different Sustainable Development Goals (SDG). Specifically the SDG linked to climate action, responsible production and consumption and industry, innovation and infrastructure. These projects also contribute to the SDG related to health and well-being, sustainable cities and communities and non-polluting energies.
Significant increase of financing to sustainable projects
BBVA publishes this report on its green bond issue activity to date as part of the commitment formally established in its framework for the issuance of sustainable bonds. In it, it details that, as of December 2019, BBVA’s portfolio of project finance and corporate lending meeting the eligibility requirements set out in BBVA’s Framework for the issuance of sustainable bonds was worth a total €2.78 billion. This amount represents a net increase of €1.69 billion from the amount in stock in 2018, despite the expected amortization of €500 million. Within this portfolio, a total of €2,087 million in loans where BBVA has measured its environmental impact in 2019.
It is worth noting that of this €2,09 billion portfolio, 69 percent of the loans granted correspond to project finance and 31% to client loans. By country, €1,359 million were used to finance projects in Spain. In the rest of Europe, €169 million corresponded to projects in France, €133 million to projects in Italy, €49 million in Ireland, €46 million in Portugal and €44 million in Scotland. In Latin America, €100 million were destined to finance projects in Chile and €51 million in Uruguay. The United States received €41 million from these funds, and Australia €95 million.
BBVA’s green track record in the markets
BBVA is one of the most experienced financial institutions in the global green bond market. Since 2007, the bank has led, structured, provided guidance on, and acted as the placement entity for social and green bonds for clients in Europe, the United States, and Latin America.
In April 2018, BBVA published its framework for the issuance of sustainable bonds, linked to the United Nations’ Sustainable Development Goals (SDGs). Days later, BBVA issued its first green bond, worth a total of €1 billion. At the time, BBVA’s inaugural green bond issuance was the largest in the euro area from a financial institution. One year later, it sold its second green bond, also worth €1 billion.
In 2019, the BBVA Group issued the first structured green bond using Blockchain technology to negotiate its terms and conditions, as well as its second green bond, which, again, was very well received by investors. In 2020 BBVA became the first European private financial institution to issue a social bond to tackle the impact of Covid-19, for a total of €1 billion.
Also noteworthy are issuances from BBVA’s franchises in Mexico and Turkey: BBVA Mexico became the country’s first private lender to successfully issue a green bond in the country, for a total of MXN 3.5 billion, while Garanti BBVA issued the first social bond in Turkey for female entrepreneurs, for a total of $75 million
All these operations are part of BBVA’s Pledge 2025 to mobilize €100 million between 2018 and 2025 to fight climate change and promote sustainable development, and of BBVA’s climate change and sustainable development strategy.
Precisely, helping customers transition towards a sustainable future, with a special focus on climate change and inclusive and sustainable social development is one of the six strategic priorities that BBVA announced earlier in 2020.