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Cryptocurrencies

BBVA taps into Ethereum to put a syndicated loan of USD 150 mln

Thursday 8 November 2018 | 12:07 PM CET

BBVA, a Spain-based banking group, has completed a pilot that put a syndicated loan of USD 150 million on the blockchain.

A syndicated loan is one, where a group of banks lends together to a single borrower. In this case, the BBVA’s co-lenders were Japan's Mitsubishi UFJ Financial Group and France's BNP Paribas. In a traditional syndicated loan process, banks rely on faxes to share complex information, which not only delays the process, but is also expensive. Blockchain is seen as a means to help banks exchange information at near real-time, reducing the loan process from a couple of weeks to a day or two.

According to a report from the Financial Times, the bank arranged the loan for Red Electrica, Spain’s national electrical grid operator. The data for the loan was time-stamped at each stage of the process. The loan agreement was finally signed between the three banks and recorded on the Ethereum blockchain.

The BBVA reportedly plans to conduct more blockchain pilots for syndicated loans in the future, CoinDesk announced.

More: Link
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