Speaking at the Lord Mayor’s Trade and Industry dinner at Mansion House tonight, Javid said that the government will tomorrow invite private sector investors to register their interest in the bank, which specialises in investments in green energy projects.
“The Green Investment Bank is a world first, and it is a sign of its success that the idea is being copied globally,” Javid said tonight. “Having proven the business model works, we now want it to make an even greater impact.”
Javid first announced plans to bring private capital into the GIB at the bank’s annual review event in London last June. At the time, he said that a privatised bank would “still be green, still be profitable, still be a market-leader in financing environmentally sound infrastructure, but free from limitations on where it can borrow money and EU regulations on state aid, the bank will be able to access a much greater volume of capital.”
The GIB was first set up under the coalition government in 2012. Since then, the bank has helped to mobilise a total of £10.6bn of investment into nearly 70 projects. Sectors covered have included offshore wind, energy efficiency and waste and bio energy.
Green Investment Bank chief executive Shaun Kingsbury told City A.M. that it is the “perfect time” for the bank to start tapping the capital markets, saying: “Having seen what has been happening in the green market post the agreement that was signed in Paris, it is a great time to raise capital.”
Kingsbury brushed off concerns about market volatility, saying investors were more likely to flock to infrastructure propositions in times of market uncertainty.
“Infrastructure returns are very safe, very stable,” Kingsbury said, adding he expected investors would “try to find somewhere where they can put capital which is not correlated” to short-term market movements.