KfW concludes first contracts with promotional institutions of federal states to create affordable and energy-efficient housing

• Joint commitment for social housing in Baden-Württemberg, Berlin, Hesse and Saxony
• Global loan agreements totalling EUR 515 million
• Particularly favourable loans for new energy-efficient housing in line with climate-policy objectives of the German Federal Government

Promotional institutions of the federal states and the Federal Government are supporting the commitment of federal states and municipalities to create affordable, energy-efficient housing. To this end, KfW has entered into partnerships with the promotional institutions of the federal states of Baden-Württemberg, Berlin, Hesse and Saxony (L-Bank, IBB, WIBank and Sächsische Aufbaubank) based on global loans totalling EUR 515 million. This product designed exclusively for promotional institutions of the federal states offers funds at particularly favourable interest rates to create affordable and sustainable housing under the KfW "Energy-efficient Construction" programme (CO2 building rehabilitation programme of the German Federal Government). The promotion is subject to compliance with the KfW Energy Efficient House 70 standard and focuses on the construction of rental housing.

Over the next two years, up to EUR 2 billion will be made available to all of the promotional institutions of the federal states. Ultimate borrowers benefit from the very low rates of interest, long terms and fixed-interest periods. The interest is reduced through budget funds.

The Federal Government, KfW and the promotional institutions of the federal states are jointly offering incentives to create affordable housing, and are thereby making an important contribution to satisfying the growing demand. "The joint involvement of the Federal Government, KfW and the promotional institutions of the federal states focuses on creating additional, affordable and energy-efficient housing. This is crucial for strengthening social cohesion in Germany," said Dr Ingrid Hengster, Member of the Executive Board of KfW Group.