KfW boosts green loan quota
German bank KfW plans to extend €100bn in loans for renewable energy projects in the next five years, and to increase its environment quota from 32% to 36% in 2012.
As part of its plan to support the energy turnaround, the bank dedicated 41% of its promotional business volume, or €12.1bn, to the promotion of environmental and climate protection in the first half of 2012.
KfW CEO Ulrich Schröder says: "In implementing the energy turnaround, KfW has taken responsibility as a promotional bank. As well as supporting enterprises in developing and implementing new technologies, KfW has lowered interest rates in many programmes of the 'Energy Turnaround Action Plan' to a historic low of 1%."
The promotion of environmental protection received €4.9bn of the bank's portfolio in the first six months of 2012, and commitments under the KfW renewable energies programme reached €3.8bn, an increase of €1bn over last year's figure. However, the bank's offshore wind energy programme has not yet made any commitments in 2012, and KfW explains that delays in the grid connection of offshore wind farms has postponed projects.
In the meantime, KfW-Ipex Bank's export and project finance segment registered a drop in new business, reaching €5.7bn from €8.4bn in H1 2011. "The change against the same period last year is fundamentally due to the decline in demand for funding for banks under the CIRR for ship financing, which Ipex is conducting as agency business for the Federal Republic.
"The original lending business developed positively, and all business segments have contributed equally to this trend. The regional distribution of new commitments is equally balanced across Germany, Europe and the rest of the world," KfW explains.
Over the same period, KfW also increased its risk provisions for lending business to €166mn, pursuing a "conservative risk policy" and taking into account "the more negative risk situation, particularly in the business segment shipping within export and project finance", the bank says.
The bank's total financing volume fell to €29.9bn in H1 2012; a drop attributed to KfW's strategic focus and changes in the methodology of general refinancing of promotional institutions of the federal states from annual to quarterly agreements.