Ledesma is the First Argentine Company to receive a “Green Loan”
BBVA Bank classifies three loans –granted to Ledesma in 2021 and amounting to ARS 1,250 million– as Sustainability-Linked Loans. This way, Ledesma is the only Argentine Company with a KPI Linked Loan, a product providing for paying an interest rate linked to the achievement of pre-agreed sustainability targets.
The Credit Risk Agency FIX, affiliate of Fitch Ratings in Argentina, has classified the loans based on their compliance with the Sustainability Linked Loan Principles (SLLPs) issued by the Loan Market Association (LMA), the Loan Syndications and Trading Association (LSTA) and the Asia Pacific Loan Market Association (APLMA).
Sustainability-Linked Loans are a tool to raise capital that incentives borrowers to achieve pre-agreed and closely monitored ESG Goals including quantitative and qualitative metrics and external controls. In this sense, borrowers publicly declare their intention to improve environmental or social performance targets within a pre-set term.
Ledesma will allocate this loan´s proceedings to Working Capital and has therefore established two KPIs aimed at reducing greenhouse gas emissions (GHG)–ranked under scope 3 (direct and indirect emmisions, including the ones generated in its chain value) and at increasing the use of renewable energy in power consumption. It is worth mentioning that the Company has already been applying these concepts to its operative processes for many years and more than half of its energetic matrix is currently sourced by self-generated renewable energy. Added to this, Ledesma has already dropped its greenhouse gas emissions significantly and aims to continue this decreasing trend on almost 25% by 2030, considering the year 2015 as baseline.
In case that BBVA and Ledesma’s pre-agreed ESG Goals are met, a 0.25% reduction on the loan interest shall apply; otherwise, a 0.25% increase shall apply.
“Being pioneers in granting Sustainability-Linked Loans in our country opens up new possibilities for BBVA customers in Argentina. This new trend is also aligned with our Sustainability and SDGs Compliance strategy –a fundamental pillar for our business activity” said Carlos Elizalde, Corporate & Investment Banking Director at BBVA in Argentina.
“Sustainability is in Ledesma’s DNA and we have been working on innovating and enhancing this aspect for many years. One example is the preservation of 100,000 hectares of native forests in Jujuy and the generation of renewable energy from sugarcane plant waste. For this reason, being pioneers in obtaining this type of loan tied to sustainability goals is a consequence of a long path taken which will also lead to a more fruitful path in the future” said Humberto Solá, Ledesma’s Innovation, Environment and Energy Director.
