Porsche taps BBVA blockchain platform for acquisition term loan

Spanish banking giant BBVA has closed a €150 million term loan for Volkswagen subsidiary Porsche using blockchain technology.

According to the official release, Porsche is the first non-Spanish borrower to use blockchain technology for the negotiation and closing of a corporate loan.

The pilot used the distributed ledger technology (DLT)-based platform developed by BBVA. It marked the first acquisition term loan ever arranged through blockchain technology, BBVA said.

“This transaction is all about putting blockchain technology into meaningful practice in the interactions with our clients. Our aim is to improve clients’ experience by simplifying processes and enhancing the speed of execution. To be on a common path with our longstanding partner Porsche Holding makes us equally proud,” Frank Hoefnagels, Head of BBVA CIB in Germany, said.

BBVA explained that blockchain technology significantly improves client experience by automating the negotiation process and minimizing operational risks. In addition, the technology also helps to enhance the speed of execution of acquisition finance transactions, and ensures traceability and immutability.

“With digitalization being an integral part of Porsche Holding’s Strategy 2025, the goal is to advance in all fields of activity. We think that the blockchain technology has great potential and are therefore very excited to being able to explore the technological capabilities together with BBVA,” Dominik Paschinger, Branch Manager of Porsche Corporate Finance in Belgium, said.

Last month, BBVA, in collaboration with two leading banks – BNP Paribas and MUFG, completed a syndicated loan using distributed ledger technology(DLT). BBVA said that the €150 million deal was reached in record speed. It involved arranging and signing the terms of a syndicated loan for Red Electrica Corporation using BBVA’s proprietary blockchain platform.

BBVA was also one of the first five banks invited to join the launch of the 'International Association for Trusted Blockchain Applications' (IATBA), a European platform to promote the use of the 'blockchain'.