SBM-1 – Strategy, business model and value chain
Material products and services, markets, and customer groups
Rentenbank is Germany’s promotional bank for agribusiness and rural areas. Its statutory promotional mandate is to support investment in an efficient, competitive and sustainable agribusiness sector and in the development of rural areas. In fulfilment of this mandate, we grant special programme loans in a competitively neutral way through the local banks of the ultimate borrowers and provide funding to banks, savings banks and local authorities with a connection to rural areas. We also award grants for innovation and applied research projects, as well as for projects and institutions of particular importance to the agricultural sector and rural areas. Rentenbank finances innovative agri-related start-ups by means of subordinated loans and complementary innovation vouchers using the German Federal Government’s Special-Purpose Fund Administered by Rentenbank. This fund is built up through allocations from Rentenbank’s profits. Rentenbank also invests in venture capital funds whose investment strategies include agri-related start-ups.
Rentenbank’s business model is based on the on-lending principle. As a rule, promotional loans are not granted directly to ultimate borrowers, but through intermediary credit institutions, which act as Rentenbank’s direct contractual counterparties. The local banks are responsible for the lending decision, the customer relationship and the ongoing support of the ultimate borrowers. They also bear the default risk in relation to the ultimate borrowers.
Rentenbank’s promotional programmes are aimed at operating companies in agriculture, forestry, viticulture and horticulture, manufacturers of agricultural production inputs, and trading and service companies closely linked to agriculture. We also finance projects in the food industry and in other companies in the upstream and downstream sectors along the entire food value chain. In addition, we support the expansion of renewable energy, private-sector engagement and public investment in rural areas. Particular emphasis is placed on promoting innovation and sustainable investment, including in renewable energy. Rentenbank also fulfils its promotional mandate by acting as a funding partner to lending banks operating in agriculture, as well as to German local authorities.
As a result of the on-lending principle, the local banks are the primary focus of the business relationship from an operational and risk perspective. At the same time, Rentenbank’s material sustainability-related impacts arise through the investments financed by the ultimate borrowers. This impact logic is characteristic of the business model of a public promotional bank and shapes the design of the sustainability strategy and management approaches.
As of 31 December 2025, 492 people were employed at our sole location in Frankfurt am Main.
Sustainability goals
We set sustainability targets in particular through the sustainability programme and the climate strategy.
The sustainability programme takes a holistic, organisation-wide approach and covers the entire value chain. For the first time this year, we have linked the programme to the relevant impacts, risks and opportunities in order to ensure that our measures address the matters that are material to us.
The climate strategy sets targets primarily for our credit portfolio and, to a lesser extent, for climate-relevant emissions arising from our operational ecology. The focus is on decarbonising the credit portfolio by creating incentives for climate-friendly agricultural measures, financing renewable energy and participating in initiatives. At the same time, it is recognised that agricultural production is structurally emission-intensive as a result of biological processes and that, on the basis of current knowledge, complete climate neutrality in the sector does not appear achievable in the long term. Rentenbank’s strategic objective is therefore not the short-term elimination of emissions, but the gradual reduction of emissions intensity and the expansion of financing that avoids or sequesters emissions, for example in the area of renewable energy or natural climate change mitigation.
Most important products, services, markets, and customer groups in relation to sustainability goals
Our GHG inventory shows that by far the largest share of our financed emissions are in the credit portfolio. At the same time, by financing renewable energy, incentivising climate-friendly investments and promoting innovation in this area, we have the greatest leverage for financing the ecological, social and digital transformation in agriculture and rural areas. Our strategy therefore focuses in particular on the lending business. In this area, we support established companies and farms, as well as young businesses through venture capital investments and start-up promotion.
Rentenbank’s strategic orientation takes into account the key social trade-offs in the agricultural sector, in particular those between food security, climate change mitigation, resource conservation and the economic viability of agricultural enterprises. In doing so, we consistently attach priority to the economic viability of agriculture as a whole. Against this background, Rentenbank pursues a transformation-oriented approach aimed at enabling sustainable development through targeted financing and at creating incentives for such development by using the levers available to it.
Value chain and impact logic
Rentenbank’s value chain is shaped to a significant extent by the on-lending principle. The organisation’s own operational value creation focuses on the design of promotional programmes, refinancing on the capital markets and the provision of long-term financing. Rentenbank’s main sustainability-related impacts arise through the financing of economic activities in the sectors and areas covered by its promotional mandate.
Rentenbank’s value chain comprises
- refinancing on the capital market;
- the development and provision of funding instruments;
- cooperation with local banks;
- the execution of securities transactions supporting the promotional mandate through liquidity and risk management;
- the financing of investments by ultimate borrowers in agriculture and forestry, upstream and downstream areas of the value chain, in renewable energy and in rural development;
- the provision of funding to banks, savings banks and local authorities operating in rural areas;
- the promotion of young and innovative companies through start-up programmes and networks, as well as through investments in venture capital funds; and
- active engagement with our stakeholders from politics, agriculture and the financial sector.
A wide range of input factors is required to realise this value chain. At the same time, it generates a variety of outputs. Our employees are among the most important input and success factors. Their qualifications, experience and committed contribution to fulfilling our statutory promotional mandate are crucial throughout the value chain. Chapter S1 explains how Rentenbank supports its employees in this regard.
Refinancing on the capital market is another key input, without which we would be unable to fulfil our mandate. We use international issuance programmes and domestic capital market instruments to raise the funds that we can pass on to our ultimate borrowers. Our AAA rating enables us to raise funds on particularly favourable terms. We are able to pass these terms on in our promotional business. We attach particular importance to green bonds as part of our refinancing activities. We issued our first green bond as a private placement in 2013, followed by our first public green bond in 2020. The net proceeds of these bonds are used to finance renewable energy projects under the “Rural Energy” promotional programme, thereby helping to mitigate climate change. We issue green bonds on the basis of our Green Bond Framework, which is aligned with the ICMA Green Bond Principles and supported by a second-party opinion. Based on quantitative key figures, impact reporting provides annual information on the positive environmental impact of the asset portfolio. In particular, it reports on total financed renewable energy capacity, annual electricity generation and greenhouse gas reductions. This reporting is based on calculations by an independent research institute.
The most important output is the wide range of financing options through which we fulfil our promotional mandate. Established companies are financed primarily through programme loans. Young and innovative companies receive financial support through our start-up promotion programme and our investments in venture capital funds. We also provide funding to banks, savings banks, and local authorities operating in rural areas. Special promotional loans may be combined with budgetary resources of the German federal government in the form of grants or guarantees.