Intesa Sanpaolo starts EUR 2 billion sustainability loan program for small businesses

July 31, 2020. Print article

Italian bank will invest EUR 2 billion ($2.4 billion) of sustainable loans into small and medium enterprises to transition them toward environmental, social and governance objectives, its latest step in supporting sustainable development.

The loan program will support businesses planning to make progress in sustainable growth, the bank said Friday. The investments by Italy’s largest bank by assets will be made in line with the European Commission action plan on financing sustainable growth, which in 2018 established standards for “green” financial products and encouraged greater disclosure of environment-related data.

Intesa Sanpaolo, Italy’s second-largest bank by assets, said its sustainability loans will feature ESG objectives relevant to the receiving businesses and provide “various forms of ‘recognition’” for those that achieve their objectives.

The new credit will be “another step forward” in the recovery for small and medium-sized businesses, “which are increasingly moving towards reducing their environmental impact and improving their social and governance performance,” said Stefano Barrese, head of the “banca dei territori” division at Intesa Sanpaolo.

The sustainability loan program is part of Intesa Sanpaolo’s four-year plan to invest more than EUR 300 billion ($354 billion) by 2021 with a focus to “prioritize strong and sustainable value creation and distribution.” One of the bank’s largest sustainable investments under the plan has been its EUR 5 billion ($5.9 billion) “circular economy” fund allocated to support development of sustainable, waste-free business models.

Intesa Sanpaolo will also play a role in Italy’s plan to support a sustainable recovery from the COVID-19 pandemic, particularly by financing 110% tax offsets for costs tied to energy efficiency costs. The Italian government is supporting an eco-friendly restoration through many other avenues, such as giving urban residents a bonus for their bike purchase and investing EUR 300 million ($354 million) into public-sector projects in renewable energy, transportation and urban development.