BBVA and EIB sign €1bn synthetic securitisation on blockchain
BBVA and the European Investment Bank Group (EIB) have signed a synthetic securitisation of €1 billion on blockchain.
The agreement is the first of its kind in the European Union and the third synthetic corporate loan securitisation signed by EIB and BBVA.
The DLT platform developed by BBVA was used to negotiate this agreement, from the origination to the signing, and also ensures “traceability and immutability”, so making the documentation process “safer and more transparent”.
All the negotiation was recorded on the private blockchain Hyperledger, while a hash or unique identifier of the signed agreement were recorded on the public blockchain Ethereum (testnet).
BBVA and EIB Group will also provide €360 million to finance investments projects of Spanish SMEs and midcaps, for which the EIB Group, formed by the European Investment Bank and European Investment Fund (EIF), have granted BBVA a €60 million synthetic guarantee.
The agreement got support from the European Fund for Strategic Investments (EFSI). BBVA says EFSI’s support increases the EIB Group’s capacity to finance investment projects with a higher risk profile.
In November 2017, EIB and BBVA provided €300 million to finance the digitalisation of small Spanish businesses; in June 2016, they launched a €600 million credit line; and in 2015, they approved a €1 billion credit line to help SMEs.
This synthetic development is another chapter in BBVA’s blockchain progress.
Last week, BBVA and Porsche Holding Salzburg closed the “first” acquisition term loan using the technology.
Prior to that, BBVA and Santander got involved in the European Commission’s planned launch of the International Association for Trusted Blockchain Applications (IATBA) next year.
In addition, BBVA delivered the first syndicated loan on the technology; and joined a pilot test for improved issuing of warrants.
