The European Investment Bank (EIB) Group has reached a guarantee deal with LBBW allowing the German lender to provide loans of up to EUR 350 million (USD 368.9m) on favourable terms to finance renewable projects.
The EIB Group said on Thursday that it is providing a EUR-175-million guarantee, which unlocks additional lending capital that LBBW will use to support companies building wind farms and solar plants.
The transaction is expected to result in the development of about 340 MW of new electricity generation capacity from renewable sources. The projected output should be able to meet the needs of over 1 million households.
The beneficiary companies will be in Germany, other EU member states and Switzerland.
The financing to be lent is freed up via the synthetic securitisation on an underlying loan portfolio of EUR 3.2 billion. It consists of loans to small and medium-sized companies and other entities originated by LBBW in its ordinary business.
(EUR 1 = USD 1.054)