Frankfurt am Main/Bremen – ING Wholesale Banking has issued the world’s first loan tied to the new €STR. The loan will be used for the funding of a wind farm project. ING has granted a 19-year bilateral loan to the eco-friendly electricity provider Energiekontor AG, whereby the interest rate is not based on Euribor (Euro InterBank Offered Rate) but rather on the €STR (Euro Short Term Rate) newly developed by the European Central Bank.
"Given the long-term nature of the loan, we decided to use a stable and permanent reference rate for our project. We are especially pleased that in using the €STR as a basis, we are also taking an innovative approach to financing," says Günter Eschen, member of the board of Energiekontor AG, explaining the decision.
Olaf Beyme, Head of Renewables & Power at ING Germany adds: "The fact that we were able to use €STR as a benchmark for the first time in the funding of this wind farm is a major milestone for us and it underlines our ability to offer our corporate clients future-proof loan solutions.”
This pilot project does not only make Energiekontor AG a pioneer in the renewable energy sector, but also positions the company as a pioneer in the use of the ECB's new reference interest rate. "Our strategy is to always offer our customers smart and innovative solutions. With this project financing, Energiekontor AG is one step ahead and well-equipped for the future – especially in light of uncertainties around the continuity of Euribor and Libor," says Thomas Epple, Head of Financial Markets Germany & Austria at ING Germany, who is in charge of benchmark rates at ING in Germany. “The special appeal of this deal stems from the fact that both the underlying transaction and the interest rate hedge use the official rate from the ECB, making potential future adjustments less likely.”
Dr. Christian Storck, Partner at Linklaters, served as ING’s legal advisor in this transaction.
About ING Wholesale Banking Germany
ING Wholesale Banking Germany comprises the corporate clients business of ING in Germany and is part of the ING Group’s worldwide Wholesale Banking network with offices in more than 40 countries. ING Wholesale Banking offers banking services for large, internationally operating corporate clients. In addition to traditional banking products such as Corporate Lending and Transaction Services, ING is a world leading name in structured & project financing concepts, complemented by capital market solutions. ING Wholesale Banking Germany has approximately 300 employees based in the headquarters Frankfurt am Main who were in charge of a credit volume of EUR 35 billion by the end of 2019. Under the division “Energy”, ING bundles a wide range of expertise covering all matters related to financial services for clients in the German energy sector.
About Energiekontor AG
A solid business policy and a great deal of experience in wind and solar power: this is what Energiekontor has stood for 30 years. Founded in Bremerhaven in 1990, the company is one of the pioneers in the industry and is now one of the leading German project developers. The core business ranges from planning and construction to the operational management of wind and solar parks in Germany and abroad. In addition, Energiekontor operates wind and solar parks with a nominal output of almost 287 megawatts in its own portfolio. Energiekontor also wants to take on a pioneering role in economic terms and realise the first wind and solar parks in all target markets as quickly as possible at market prices, independent of state subsidies. In addition to its headquarters in Bremen, Energiekontor has offices in Bremerhaven, Hagen im Bremischen, Aachen, Augsburg, Bernau near Berlin and Potsdam. The company also has branches in England (Leeds), Scotland (Edinburgh, Glasgow), Portugal (Lisbon), USA (Austin/Texas and Rapid City/South Dakota) and France (Toulouse, Rouen). The proud record since the company was founded: 126 wind farms and eight solar parks with a total capacity of over 1 gigawatt. This corresponds to an investment volume of almost 1.7 billion euros.