Spanish lender BBVA has agreed with United Arab Emirates–based climate investor ALTERRA to establish a co-investment vehicle targeting $1.2 billion in commitments. The fund will finance climate-aligned projects worldwide across three pillars: infrastructure, private equity and private credit. Each partner will contribute 50% of initial capital, with BBVA allocating €500 million from its sustainable investment arm and ALTERRA matching that in US dollars. The financing vehicle aims to back at least 15 infrastructure projects over the next five years, focusing on renewable energy generation, water treatment plants and low-carbon transport. In private equity, the fund will seek minority stakes in growth-stage cleantech companies with proven revenue streams, targeting a minimum equity investment of $20 million per deal. The private credit tranche will provide senior and mezzanine loans to mid-market firms transitioning away from fossil fuels, with average ticket sizes of $30 million and tenors of three to seven years. BBVA’s participation reinforces its commitment to sustainable finance, building on the bank’s €20 billion of green and social loans originated in 2023 and its pledge to achieve net-zero financed emissions by 2050.