BNP Paribas Asset Management (BNPP AM) has launched two infrastructure debt funds. The European Infrastructure Debt Fund II seeks to raise 500 million euros (US$611 million), while the European Junior Infrastructure Debt Fund I targets 300-500 million euros.
Both funds will be diversified across sectors and will adhere to a rigorous environmental, social and governance (ESG) policy in accordance with analysis provided by BNPP AM's Sustainability Centre, the company notes.
In order to build sustainable portfolios with high-quality ESG client reporting, the management team will use independently-provided impact studies, enabling them to assess avoided greenhouse gas emissions, net environmental contribution and alignment with the goals of the Paris Climate Agreement, BNPP AM says.
BNP Paribas European Infrastructure Debt Fund II follows the success of a first senior debt fund launched in late 2017, which raised assets of 474 million euros and is currently at the end of its investment period.
The fund has had a strong focus on the digital infrastructure and renewable energy sectors, which have been particularly resilient in the current economic environment. It attracted 14 institutional investors from the United Kingdom, Ireland, France, Belgium and Italy.
BNP Paribas European Junior Infrastructure Debt Fund I will benefit from the experience gained through an exclusive partnership with an Asian investor. Investments will be in European non-investment-grade infrastructure debt offering stable and predictable cash flows.
Karen Azoulay, head of infrastructure debt at BNPP AM, comments: “Infrastructure assets have shown strong resilience in recent months, given the central role of the services that they offer, such as power generation, water treatment or high-speed internet access. Investors seeking exposure to assets that can weather economic turbulence and crises such as Covid-19 appreciate that infrastructure debt is able to generate stable cash flows over the long term throughout the economic cycle.”