Since 2 October 2019, the European Central Bank has regularly published a new reference interest rate, the €STR (Euro Short-Term Rate). This was developed against the backdrop of a fundamental reform of the European reference rates and is intended to provide a long-term replacement to the EONIA reference rate for the overnight money market. ING recently issued the world's first loan tied to the new €STR.
With this credit package, ING is providing Energiekontor AG with a 19-year loan, which also complies with the latest standards provided by financial benchmarks. As other reference rates such as Euribor and Libor could fall away in future as part of the reform, and given that the loan has a long term, Energiekontor AG is now protected against any future policy changes.
Sustainable financing solutions
For ING, the €STR-linked loan is a milestone in corporate finance. It emphasises our corporate clients’ demand to be offered more innovative and future-proof financing solutions. What's more, the loan will be used to fund a wind farm and will have a doubly sustainable impact.