BBVA Closes Blockchain-Powered Sustainable Schuldschein Loan For Madrid Government

BBVA announced on Wednesday it closed a blockchain-powered sustainable “Schuldschein” loan for the Madrid Government. BBVA reported that the deal, which is structured as per the German debt instrument, is worth a total of €220 million and will be allocated to sustainable projects. BBVA revealed:

“This type of debt instrument is designed to foster transparency and finance sustainable development in the region of Madrid. To this end, Madrid’s regional government has produced a sustainable financing framework, which the leading ESG rating and research agency, Sustainalytics, assessed and deemed to be solid, trustworthy, and aligned with the Green Bond Principles. These Principles are standards that guide major financial institutions and other market participants in the selection and governance of projects that are aligned to environmental sustainability. BBVA was the structurer of this framework.”

BBVA also noted that the deal enabled both parties to make progress with their digitization processes as they collaborated and shared their experience of using new technology. BBVA went on to add:

“This deal is especially important having been negotiated using blockchain, a technology the bank is exploring given its obvious benefits. This technology facilitates access for all the participants involved in the transaction and reduces the negotiation time thanks to the digitization of the entire process. Additionally, the DLT (distributed ledger technology) network that was established between the two parties ensured traceability and immutability during the negotiations and in the resulting agreements. The Region of Madrid is a BBVA strategic client. The bank is one of the leading finance groups with whom Madrid collaborates, both for its financing products as well as in the placement of different debt issues.”

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