BBVA And EIB Unlock €185M For Green Housing In Spain

BBVA and the EIB Group, which includes the European Investment Bank (EIB) and the European Investment Fund (EIF), have joined forces to introduce a €93 million InvestEU-backed synthetic securitisation. This process is designed to free up up to €185 million of funding for green residential developments throughout Spain, securing the EU's commitment to reducing emissions and increasing energy efficiency and climate resilience.

The financing will go toward small and medium-sized enterprises (SMEs) and medium-cap firms for building near-zero emissions housing units. Through giving access to better financing terms—which are too commonly out of reach without the involvement of public capital—the collaboration allows for greener housing transition. The total size of the fund is focused entirely on green building, making all financed projects have a positive contribution to greater energy efficiency, less CO₂ emission, and EU's wider climate goals.

A considerable percentage of the projects will be implemented in cohesion areas, whose per capita income is less than the EU average. This not only increases environmental sustainability but also increases social and economic development in deprived areas. By targeting these areas, the initiative maximizes its effects, promoting economic inclusion while dealing with housing affordability and energy efficiency issues.

The EIB commits €93 million under InvestEU, which significantly contributes to alleviating investment risks and supporting EU capital markets. By taking the risk on the mezzanine tranche, the EIB Group de-risks green financing for BBVA, enabling the bank to mobilize its capital more effectively and increase opportunities to finance sustainable initiatives. The transaction is supported by a €1.4 billion securitisation of BBVA's loan book to SMEs, with the bank holding both senior and junior tranches of the securitisation. This structure qualifies for simple, transparent, and standardised (STS) securitisation, featuring synthetic excess spread and pro-rata amortisation with the ability to convert to sequential repayment if necessary.

The role of the EIB Group in this transaction reflects its strategic priorities—climate action, sustainable and affordable housing, and financial markets integration. By using securitisation as a financial instrument, the project illustrates how public-private partnership can mobilise capital for green investments while reducing risk for sponsoring financial institutions.

This collaboration also supports the EU's long-term vision of speeding up the green transition and promoting the capital markets union. It underscores the growing role of innovative financial instruments in amplifying sustainable investments. Through mobilizing capital and de-risking green innovation, the initiative paves the way for future collaborations to meet the EU's ESG objectives.

BBVA's wider commitment to sustainable finance is also seen in its recent establishment of a new global finance unit focused on cleantech innovation. This strategic initiative reaffirms the bank's leadership in spearheading climate finance and promoting companies that are environmentally sustainable.

As the EU ramps up the drive towards a low-carbon economy, efforts such as these show the ability of financial innovation to drive climate objectives. Through the blending of public sector backing with private sector lending, BBVA and EIB Group's collaboration is a model for tapping capital markets in order to support sustainable development faster.