Bank of Ireland (B of I) plans to enter the €7 billion environmental services and renewable energy market with a specialised €500 million fund for lending to projects in those sectors.

The bank's director of corporate banking, Mr Padraig Rushe, said yesterday that the group already had an involvement in both businesses at national and international level.

"We have experience and expertise in both sectors and, looking at the Irish market, €7 billion will be available in this area over the next five years," he said.

Mr Rushe said the fund would be used to provide projects with loan finance. "Typically, the partners involved in each project put up the equity, and we will provide the layer of debt on top of that," he said.

Head of the environmental finance group Mr John Riordain said the projects that are likely to be supported would include renewable energy developments like wind farms, water treatment and waste management. He pointed out that these were specialised areas, with undertakings that generally had a 10-15 year horizon for investors.

Mr Rushe said the €500 million would be an initial tranche and that the bank would not limit itself to this sum. The bank introduced the fund at a seminar yesterday.