TLDR
- ING is offering 12 data centre loans worth about $500 million, with bids due November 19.
- The loans include a $25 million piece tied to Stargate, plus debt linked to Vantage Data Centers and CyrusOne.
- The S&P 500 fell 4.4% and the Nasdaq Composite fell 5.5% on November 5.
- Oracle reportedly sent a force majeure notice on the New Mexico Stargate site but says it is on schedule.
- CoreWeave’s credit default swap spreads reached record levels.
Dutch bank ING is reportedly offering about $500 million in loans tied to artificial intelligence data centres. Reuters reported the news, citing Bloomberg.
The bank is selling 12 loans through a competitive bidding process. Buyers must submit offers by November 19.
ING is seeking bids of at least $10 million, according to Bloomberg. The bank has declined to comment publicly.
The package is made up only of data centre debt. That makes it one of the clearer tests of how much demand exists for this type of lending.
One loan, worth $25 million, is linked to Stargate. Stargate is an AI infrastructure project backed by OpenAI, SoftBank and Oracle.
Other loans in the portfolio are connected to data centre operators Vantage Data Centers and CyrusOne.
Oracle Notice on New Mexico Stargate Site
Attention has also turned to the Stargate site in New Mexico. Oracle reportedly sent a force majeure notice to the project’s developer.
A force majeure notice is a legal tool. It can protect a company when events outside its control stop it from meeting a contract.
Oracle says the project remains on schedule. It also says such notices do not necessarily point to construction delays.
A loan sale does not mean a borrower is in trouble. Banks often sell debt to manage risk, free up capital and rebalance their holdings.
The sale comes after a sharp drop on Wall Street. About $3 trillion was erased from S&P 500 companies on November 5.
Stocks Fall After Midterm Election Results
The S&P 500 fell 4.4% on November 5, according to the Associated Press. The Nasdaq Composite dropped 5.5%.
Technology and AI infrastructure companies were hit hard. Investors reassessed the sector after Democratic wins in the US midterm elections.
The results raised concerns about new limits on data centre construction. Some states face pressure over electricity prices and water use.
Reuters reported that Applied Digital, Cipher Digital and IREN each saw large share price declines.
CoreWeave, an AI cloud infrastructure provider, also came under pressure. Investors questioned its heavily debt-funded growth.
The company’s credit default swap spreads widened to record levels. These contracts act as insurance against a borrower failing to repay debt.
AI infrastructure relies on outside financing. Companies pay for chips, power systems and construction years before projects earn returns.
Bitcoin mining firms that are moving into AI infrastructure work could also face higher financing costs or project delays.
Bidders have until November 19 to submit offers for ING’s loans.
