Iberdrola, ICO, Sabadell and HSBC sign a EUR 500 million syndicated green loan with Cesce coverage
Iberdrola, ICO, Sabadell and HSBC have signed a syndicated green loan for an amount of 500 million euros that is covered by Cesce through its Green Investment Policy on behalf of the State, which is guaranteed by the Internationalisation Risk Reserve Fund (FRRI), attached to the Ministry of Economy, Trade and Enterprise. The green loan, which has a repayment term of 15 years, will strengthen the diversification of Iberdrola's sources of financing.
It is the first loan aimed at promoting renewable energy projects that the ICO will finance with Next Generation funds in the second phase of the Recovery Plan. The operation is part of the ICO-Verde programme, which was activated with the signing of the agreement between the Ministry of Economy, Trade and Enterprise and the ICO. The funds from the operation will be used to finance renewable wind and photovoltaic projects, as well as battery projects in the United States, Australia and Italy. The total renewable capacity financed will reach 897 MW and is expected to be operational between 2025 and 2026.
The total amount of Iberdrola's loans under the coverage of Export Credit Agencies (ECAs) is EUR 2.5 billion. These entities exclusively manage credit and investment insurance on behalf of states, covering political, commercial and extraordinary risks associated with internationalisation.
This loan contributes to diversifying Iberdrola's financing, which is able to combine various sources: capital markets, financial institutions, development banks such as the World Bank or the European Investment Bank (EIB) and state agencies for the promotion of exports that reduce or eliminate the risk of operations. In this case, HSBC was the coordinating bank for the operation.
Cesce, in its role as the Spanish Export Credit Agency (ECA), exclusively manages credit and investment insurance on behalf of the State, thus covering the political, commercial and extraordinary risks associated with the internationalisation of Spanish companies. Its Green Investment Policy, in particular, covers the risks of credits granted to Spanish companies or their foreign subsidiaries for the financing of projects abroad that are considered green, as they meet the requirements set out in the EU Taxonomy or Annex I of the OECD Consensus.
International confidence
Banking confidence in Iberdrola is constant. Last month, Iberdrola diversified its financing with a CHF 335 million green bond placement.
In addition, in March it signed a 700 million euro green loan with the European Investment Bank for the expansion of electricity grids in Spain and in January Iberdrola and the World Bank extended their alliance with a 300 million euro green loan for renewable projects in emerging countries.
That same month, it issued 700 million euros in hybrid bonds, thus keeping the company's hybrid volume stable at 8.25 billion euros. The funds obtained were used to refinance the renewable assets that had been financed with the hybrid bond issued in 2018, which was replaced with this operation.
At the end of December, the company signed its largest credit line in history for 5.3 billion euros with 33 international banks. The cost of this operation was at the most competitive levels for Iberdrola, with prices similar to those of 2019, and the operation was oversubscribed by more than 40%, demonstrating the strong commitment of the banks to Europe's leading utility by capitalisation and the second largest in the world.
Global leader in sustainable and green finance
Iberdrola has established itself as a global benchmark in sustainable financing, being the first private group in the world to issue green bonds, after becoming the first Spanish company to issue a bond of these characteristics in 2014. The group currently has more than 22,000 million euros of green bonds outstanding.
In the banking market, in 2016, the company also underwrote the first green loan for an energy company, in the amount of 500 million euros. That transaction was followed by various loan operations and credit lines linked to sustainability criteria.
This financial strategy complements and strengthens the historic investment plan launched by the company in March 2024, in which it announced the investment of 41 billion euros between 2024 and 2026. The plan aims to drive the electrification of the economy, with a strong boost to electricity grids and renewables.