BBVA seals its first green loan in the U.S. with AVANGRID

AVANGRID has entered into a $2.5 billion syndicated sustainability-linked credit facility, the biggest green loan in the U.S. to date. In doing so, AVANGRID demonstrates its commitment to combating climate change. BBVA has acted as sustainable agent and joint lead arranger for the deal.

The green loan takes the form of a revolving credit facility (RCF) expiring in 2023. It includes an innovative price-adjustment mechanism based on the continuous reduction of AVANGRID’s emission intensity. The sustainability indicator will be independently verified by the agency Vigeo Eiris.

This deal allows AVANGRID to not only adapt liquidity to its $14.4 billion investment plan for the period 2017-2022 but also confirms the company’s commitment to safeguard the environment, reduce its carbon footprint, and grow as a sustainable company. The principles of its strategy published in its Annual Sustainability Report adhere to the UN’s Sustainable Development Goals for 2030.

“Development of clean energy and respect for the environment are pillars of our energy production model and our operations,” explained P. Torgerson, CEO of AVANGRID.

This is the second time that BBVA has worked on a sustainable finance deal with AVANGRID, Inc., the U.S. subsidiary of Iberdrola. Last year the bank participated in the issue of its inaugural green bond.

BBVA works closely with the Iberdrola Group to help it meet its commitment to sustainable finance. In 2017, Iberdrola became the first energy company in the world to arrange a green loan. In 2018, the company signed two syndicated loans in Spain for a value of 5.3 billion euros, and the first corporate green loan in Latin America through its subsidiary in Mexico. BBVA acted as sustainable agent for each of these deals.

BBVA has the capability, knowledge, and experience to provide its customers with top-quality advice on sustainable finance solutions in both bonds and loans, and it is playing a key role in developing both markets.

In the green loans business, in which BBVA has been a pioneer and is a fundamental driving force, the bank has been the most active institution worldwide in the past 18 months, closing no less than 16 deals in Europe and Latin America for customers from a variety of sectors. In Spain, it is the undisputed leader.

The bank was the most active bookrunner in the green bond market in Iberia in 2017, and has become a global benchmark after advising, placing and structuring green bonds for customers in different sectors in Mexico, the United States and Europe, in local currency as well as in euros and dollars.