BBVA has negotiated the terms of a EUR35 million structured green bond using an in-house developed blockchain platform.
Structured bonds are negotiable assets with a fixed maturity and a return that can be based on interest rates, shares, an index, or an exchange rate.
The product is designed according to the required rate of return, terms, and risk tolerance of the investor, in this case Spanish insurance house Mapre, which opted for a six year term bond linked to the evolution of the five year euro swap rate.
BBVA says that the use of a permissioned ledger reduces issuing time and ensures that negotiations and agreements reached are traceable and immutable.
The platform allows the client to choose between numerous product configuration options in an entirely digital process in which the negotiation of the structure and prices, and the creation of documentation for the bond are part of the same tool.
Juan Garat, BBVA’s head of global sales states: “With this deal, BBVA reasserts its firm commitment to both sustainable financing and new technologies. Using DLT - distributed ledger technology - for this transaction allowed us to simplify the processes and streamline the negotiation time frames, which is in line with our pursuit of excellence in customer service”.