Volkswagen Bank Issues First Green Bonds Worth EUR 1.5 Billion
Deal News | Jul 11, 2025 | Hogan Lovells
Volkswagen Bank GmbH has announced its debut issuance of green bonds, amounting to EUR 1.5 billion. In collaboration with its parent company, Volkswagen Financial Services AG, the bonds adhere to the ICMA Green Bond Principles. Structured as senior preferred bonds with terms of three and six years, the bonds offer coupons of 2.750% and 3.500% annually, respectively. Proceeds are committed to eco-friendly projects, specifically financing Battery Electric Vehicles, aligning with the Volkswagen Group's dedication to an electric vehicle future. The listing took place on June 19, 2025, following its corporate reorganization in July 2024, and under the new debt issuance program of Volkswagen Financial Services AG. Hogan Lovells provided advisory support to the banks involved in this inaugural transaction, continuing its history of working with Volkswagen's financial arms.
Sectors
- Financial Services
- Automotive
Geography
- Germany – Volkswagen Bank GmbH, the issuer of the bonds, is based in Germany.
- Luxembourg – The green bonds were admitted to trading on the regulated market of the Luxembourg Stock Exchange.
Industry
- Financial Services – The issuance of bonds, including green bonds, falls under the financial services industry, involving investment, banking, and capital management.
- Automotive – With a focus on financing Battery Electric Vehicles, the initiative supports the automotive sector's shift towards sustainable transport.
Financials
- EUR 1.5 billion – Total issuance volume of the green bonds.
- 2.750% and 3.500% – Coupons offered per annum for the 3-year and 6-year bonds, respectively.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Volkswagen Bank GmbH | Target | Company | The issuer of the green bonds, aiming to support electric vehicle sales. |
| Volkswagen Financial Services AG | Parent Company | Company | The parent company of Volkswagen Bank GmbH involved in the new debt issuance programme. |
| Hogan Lovells | Legal Advisor | Company | Advised on the debut green bond issuance by Volkswagen Bank GmbH. |