Financing Sustainability: BBVA’s €300bn Climate Commitment

Global financial services group Banco Bilbao Vizcaya Argentaria (BBVA) believes in sustainable financing, particularly renewable energy and climate tech. 

The company is in competition with itself – and winning. 

It achieved a new quarterly record by channelling €26bn (US$28.4bn) in sustainable business in the second quarter of 2024, and surpassed the first half of 2023 by 37% (compared to the same period in 2024) by totalling €46bn (US$50.2bn).

"An important catalyst of this record figure was the significant momentum in project finance, which saw triple digit growth – more than 149% in the first six months of the year over the same period in the previous year,” says Javier Rodríguez Soler, Global Head of Sustainability and CIB at BBVA. 

“This was driven by financing for renewable energy and cleantech.” 

Record-breaking sustainable financing 

BBVA is on a journey to mobilising €300bn (US$327.3bn) by 2025 (from 2018). 

So far, the company is on track to surpass this goal, having totalled €252bn (US$275.1bn) in sustainable business, of which 77% is towards fighting climate change and preserving nature, and 23% is towards promoting inclusive growth.

"We are living in an era of unprecedented change,” believes BBVA Chair Carlos Torres Vila, discussing climate change.

“This calls for a profound transformation in all sectors of society, a process that requires major investment and offers a great opportunity for long-term growth.”

The goal has already been raised three times, having originally been set at €100bn, making BBVA one of the most climate-ambitious banks. 

Renewable energy projects, boosting corporate efficiency and climatetech are key components to these increases.

The largest increase comes from the corporate banking unit which has seen a 57% increase in comparison to last year by channelling €15.8bn (US$17.2bn) between January and June 2024.

The unit works with corporate clients to increase energy efficiency, reduce water footprint and renovate vehicle fleets in the name of cost saving – and sustainability.

BBVA’s wholesale Corporate and Investment Banking (CIB) segment, which focuses on financing cleantech, climatetech and renewable energy, challenged €25bn in the first half of 2024 which is a 32% increase. Renewable energy projects financing has doubled for the company, contributing €402m in the quarter.

Sustainability at BBVA

BBVA is looking to increase its emission reduction, as well as its climate financing. 

The company has set emission reduction targets for ten sectors:

• The real estate sector in Spain
• The global aluminium industry
• Oil and gas
• Power generation
• The automotive industry
• Steel
• Cement
• Coal
• Aviation
• Shipping

“Our goal is to be net zero in carbon emissions by 2050,” says Carlos. “This includes both our own emissions and our borrowers' emissions. To achieve this, we established a roadmap and set interim targets for reducing financed emissions by 2030 for several sectors. We will continue to work on expanding the targets to other industries, in line with the framework of the Net Zero Banking Alliance.”

Earlier this year, BBVA Colombia and the International Finance Corporation (IFC) partnered to launch the finance sector’s first biodiversity bond to fund projects related to reforestation, the regeneration of natural forests on degraded land, mangrove conservation or rehabilitation, climate-smart agriculture and habitat restoration for wildlife, among other things.

"Just as we did in our digital transformation, sustainability cannot be viewed as separate from innovation,” says Carlos.

“Decarbonisation is a story of innovation. For this reason, BBVA is present as an investor in some of the most cutting-edge cleantech funds. These initiatives allow us to participate in pioneering projects and amass valuable knowledge, so that we can in turn better advise companies that can leverage these technological innovations.

“Sustainability is the path to a brighter and more prosperous future.”

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