Spanish lender BBVA and American investment firm KKR have announced a strategic partnership focused on investments related to the global transition to a low-carbon economy. The collaboration, revealed during New York Climate Week, aims to combine the financial resources of BBVA with KKR's experience in climate-focused investments.

As part of the agreement, BBVA will invest $200 million in KKR's Global Climate Strategy. The partnership will also explore opportunities in climate infrastructure-related investments, according to a joint statement from the companies.

Javier Rodriguez Soler, global head of sustainability and corporate & investment banking at BBVA, commented on the initiative: "We are confident that the second part of this decade will see strong growth of new low-carbon infrastructures. It is an immense opportunity." He added that the collaboration with KKR would be "a key piece" of the bank's sustainability strategy.

BBVA identifies sustainability as one of its six strategic priorities, with the bank operating a global financing unit specialising in clean technology innovation.

KKR meanwhile has already made three investments through its climate strategy. These include stakes in Zenobe, a UK-based provider of transport electrification and battery storage solutions, and Avantus, a US developer of utility-scale solar and solar-plus-storage projects.

Emmanuel Lagarrigue, co-head of KKR's global climate strategy, described the transition to net zero carbon emissions as "one of the biggest investment opportunities of our time". He stated, "We are delighted to collaborate with BBVA given their industry-leading presence within the renewables sector and their deep commitment to mitigating the impacts of climate change."

The partnership comes at a time when financial institutions are increasingly focusing on sustainable investments. The global shift towards a low-carbon economy is creating new opportunities for banks and investment firms to allocate capital to projects and companies that aim to reduce greenhouse gas emissions.

While the potential for growth in sustainable investments appears significant, it is worth noting that such initiatives also carry risks. The success of climate-focused investments often depends on factors such as technological advancements, regulatory changes, and shifts in consumer behaviour.

The BBVA-KKR partnership represents one of many collaborations forming in the financial sector to address climate change. As the transition to a low-carbon economy progresses, it is likely that more financial institutions will seek to form similar alliances to pool expertise and resources.

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