New head, new name for GIB as Macquarie closes deal

The revamped company will add an advisory practice to its armoury, helping governments establish similar green banking platforms.

Macquarie has named Edward Northam as the new head of the Green Investment Bank after it closed its £2.3 billion ($3 billion; €2.5 billion) deal for the UK-based renewables vehicle.

Northam, previously head of investment banking at the GIB since 2013, will take the reins from Shaun Kingsbury, the bank’s chief executive since its launch in 2012. 

He will lead the GIB under its new name – the Green Investment Group – a move Macquarie said was required “to overcome the legal and regulatory barriers” posed by the inclusion of “bank” in the group’s name.

“The use of the word bank is very problematic in most regulatory environments where you’re not actually a regulated, deposit-taking bank entity,” Mark Dooley, head of energy and infrastructure, Macquarie Capital Europe, explained to Infrastructure Investor. “GIB was able to do that in the UK, but outside there are very few places where you can even float the possibility of calling yourselves a bank if you’re not a bank.”

The revamped company will have a “pan-European focus”, Northam said, and the catalytic role of the old GIB will “remain front and centre of its work”.

Northam and Dooley also provided further information on details released after the original agreement in April. The “low-carbon lending platform” will contain investments where GCP Infrastructure will back loan notes valued at £140 million and could provide “lending in the future”, according to Northam. In addition, Macquarie’s green infrastructure investment platform will see a small portion of assets – excluding offshore wind and those subscribed to by GCP – remain held by the GIG and the UK government. Macquarie declined to state further details on these assets.

Meanwhile, a separate vehicle has been established that will own the offshore wind portfolio of the GIB and will be owned by the GIG, Macquarie and the USS pension fund. It will also hold the LP stake that GIB had in its £1 billion offshore wind fund.

The GIG will also launch advisory-based business streams that will include helping other governments set up similar green banks. Northam confirmed it is “already in discussions with a number of governments” on this matter. It will also help other green businesses on project delivery, fundraising activities and green-impact reporting.