Europe's largest electricity company by market capitalisation, with some 80 billion euros, has used its ability to finance itself in other currencies with a green bond issue placed today for 335 million Swiss francs (350 million euros) in two tranches, four and seven years, with respective interest rates of 1.38% and 1.56% (equivalent to an average of 3.5% if it had been in euros) and amounts of 145 and 190 million.
The strong demand has allowed the cost levels to fall below the lower ranges considered at the beginning of the operation.
Investors have once again demonstrated their confidence in the solidity of the utility with this issue on the Swiss market. The strength of the credit, the fact that it is a non-domestic corporate issuer and the green nature of the operation have led to strong demand, which has served to narrow the spread levels initially considered: from 50-55 basis points in the shortest term to the final 47 basis points, and from 65-70 basis points in the long term to the final 62 basis points. This is unusual in the Swiss market, where trades are usually closed at the starting levels.
The operation has been launched taking advantage of the recent interest rate cut by the Swiss Central Bank on 21 June, which has allowed the levels obtained to improve on an equivalent operation on the Euromarket. This is Iberdrola's first issue in Swiss francs since 2012 and the first in green format on that market.
The volume of demand and the conditions set once again demonstrate the great confidence of the market and investors in the soundness and solvency of the company's business and growth plan. The plan calls for investment of 41 billion euros between 2024 and 2026: 21 billion euros earmarked for electricity grids and 15.5 billion euros for renewables.
This operation will be used to finance green projects that meet the eligibility criteria established by the Iberdrola Framework for Green Finance. The coordinating banks for the issue were UBS and Deutsche Bank.
Iberdrola has established itself as a global benchmark in sustainable financing. It is the first private group in the world to issue green bonds, after becoming the first Spanish company to issue a bond of these characteristics in 2014. The group currently has more than 21,000 million euros of green bonds outstanding.
In the banking market, in 2016, the company also underwrote the first green loan for an energy company, in the amount of 500 million euros. That operation was followed by various loan operations and credit lines linked to sustainability criteria.
International confidence
Investor confidence in Iberdrola is constant. Last January, Iberdrola issued EUR 700 million in hybrid bonds, thus keeping the company's hybrid volume stable at EUR 8.25 billion. The funds obtained were used to refinance the renewable assets that had been financed with the hybrid bond issued in 2018, which was replaced with this operation.
At the end of December, the company signed its largest credit line in history for 5.3 billion euros with 33 international banks. The cost of this operation was at the most competitive levels for Iberdrola, with prices similar to those of 2019, and the operation was oversubscribed by more than 40%, demonstrating the strong commitment of the banks to Europe's leading utility by capitalisation and the second largest in the world.
It has also extended its partnership with the World Bank with a 300 million green loan for renewable projects in countries dependent on fossil fuels such as coal, including Morocco, Poland and Vietnam.
Contact:
Tel: +34 91 784 32 32
Email: comunicacioncorporativa@iberdrola.es
IBERDROLA, S.A. 
