An indirect subsidiary of Bermudian-based Assured Guaranty Ltd has guaranteed principal and interest payments on a €93.7 million (approximately $102.5 million) loan to Metro de Madrid, SA.

Assured Guaranty (Europe) SA said the proceeds will be used to partially fund the acquisition of 40 new narrow gauge and 40 new wide gauge trains that will replace the rolling stock used on lines one, six and eight of the Madrid underground network.

This financing represents AGE’s first transaction with the borrower. The 20-year, floating-rate loan guaranteed by AGE was provided by Bankinter SA.

Raphael de Tapol, directeur général of AGE, said: “We are very pleased to have closed this transaction for Metro de Madrid, which shows the value of our financial guarantee for borrowers looking to issue long term debt more cost-effectively.

“It is a key milestone in our strategy to strengthen our presence in a wide range of sectors within the European market.”

Raul Serrano, director, Infrastructure Finance of AGE, added: “After successfully providing credit protection to various banks in the secondary market in recent years, the closing of this transaction alongside Bankinter marks the first time, since the global financial crisis, that we have executed a primary market deal with a bank as beneficiary of our financial guarantee.

“We believe we will have similar opportunities in 2024, across various sectors, as more and more financial institutions are actively looking for ways to manage their portfolio exposure and lend in a more capital-efficient way.”

Domiciled in Paris, AGE conducts Assured Guaranty’s financial guarantee business in continental Europe.