Volkswagen Financial Institution Launches Initial €1.5 Billion Green Loan for Electric Car Investments
Volkswagen Bank has made history with its inaugural green bond issuance, securing €1.5 billion in June 2025. The dual-tranche offering consisted of €800 million in 3-year green senior preferred notes (due 2028, 2.75% coupon) and €700 million in 6-year green senior preferred notes (due 2031, 3.5% coupon).
The primary purpose of this green bond was to finance and refinance battery electric vehicles (BEVs), supporting the sales of electric vehicles across Volkswagen Group’s brands. The proceeds are dedicated exclusively to electric mobility, aligning with Volkswagen Bank’s sustainability strategy known as Mobility2030 and emphasizing the transition to environmentally sustainable transportation solutions.
Investor demand was strong, with over 170 investors participating in the roadshow and total demand exceeding €6.6 billion, reflecting significant market interest in sustainable financing. The bond's terms and issuance were overseen by several banks, including Commerzbank as stabilization coordinator, and ABN AMRO, Banco Santander, and RBC Capital Markets as stabilization managers, although no stabilization actions were ultimately taken.
Oliver Roes, Managing Director of Volkswagen Bank GmbH, stated that sustainability is now a fully established part of their refinancing mix. This successful green bond issuance marks a significant step forward in Volkswagen Bank's broader green financing and sustainability agenda, under its Mobility2030 strategy.
[1] Volkswagen Bank GmbH, Press Release, "Volkswagen Bank successfully completes its debut green bond issuance," June 2025. [2] Volkswagen AG, Sustainability Report 2025.
- The strong investor demand for Volkswagen Bank's green bond indicates a growing interest in financing projects centered on the energy sector, specifically the transition to electric mobility, a key focus area in their sustainability strategy, Mobility2030.
- In alignment with their commitment to technological innovation and environmental sustainability, proceeds from Volkswagen Bank's successful green bond issuance will be used to finance and refinance projects in the industry and finance sector, particularly in the area of battery electric vehicles (BEVs), supporting the shift towards more sustainable transportation solutions.
