BBVA Leads A $150 Million USD Syndicated Loan With BNP Paribas and MUFG
The Spanish bank Banco Bilbao Vizcaya Argentaria (BBVA), which is the second largest institution of its kind in Spain, has recently completed a blockchain-based syndicated loan of $150 million USD for the first time.
This syndicated banking transaction was made on the blockchain and it connected three institutions: the BBVA, it French partner, the bank BNP Paribas and Japan’s bank holding Mitsubishi UFJ Financial Group (MUFG). BBVA has secured the participation of Rd Elétrica de España, a partly state-owned company.
The companies involved signed a contract that was recorded on the Ethereum blockchain using the Hyperledger technology. The blockchain was used to ensure the immutability of the data.
A syndicated loan is when a group of banks lends money together to a single entity, in this case, Red Eletrica. At each phase of the progress, a time-stamp was made to recognize the authenticity of the project.
In a more traditional process, the banks would have to rely on faxes to share their information and to use means that were more expensive and slow to get the transactions done.
BBVA Is All About The Blockchain
BBVA’s head of finance, Ricardo Laiseca, has commented after the transaction that the recent blockchain-related initiative of many banks in the world has inspired the company to follow more efficient solutions.
The chairman of the bank, Francisco Gonzalez Rodriguez, has previously spoken about how much he likes the blockchain technology. According to him, it has the perfect technology because it provides big tools to be used and that the technology must be understood in order to stop being used for “bad purposes”.
The company has recently decided to start a partnership with the Spanish energy company Repsol to develop a new blockchain technology in a joint manner. The company is also already planning to make more of these transactions in the future as the blockchain has such a good standing in the bank.