BNP Paribas has provided housing association Peabody with a £75m sustainability-linked loan with interest rates tied to childcare training targets.
The loan is its third social impact loan in a year. It has also provided £50m to Optivo and £100m to L&Q, with interest rates tied to employment targets for residents.
Peabody will use the five-year revolving credit facility to deliver affordable housing and will reinvest the savings made from lower interest rates into the Peabody Community Foundation.
David J Reynolds, senior banker at BNP Paribas, said: “BNP Paribas has had the privilege of working with three UK housing associations to provide liquidity through individually tailored sustainability-linked loans.
“For us, this is about partnering with housing associations for the long term and supporting their continued drive to improve residents’ and communities’ quality of life, health and wellbeing.”
Susan Hickey, chief financial officer at Peabody, said: “Many working people find themselves burdened by debt from expensive childcare costs. Alongside BNP Paribas, we are determined help tackle this issue in our communities.
“Innovative funding arrangements like this are a win-win for people living in our neighbourhoods.”
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