The UK’s Green Investment Bank plans to launch a £1bn (€1.2bn) fund targeting UK offshore wind farms, the first vehicle to be overseen by a new fund management subsidiary.

Announcing its annual results, the bank said it was hoping to attract long-term institutional assets to the new fund, which will acquire equity stakes and is aiming for its first close by the end of the year.

The standalone fund manager, for which the state-owned bank was granted permission by the European Commission in May, was a “significant strategic development”, it said, and would allow it to manage funds in any of its designated green sectors – which include offshore wind, energy efficiency, waste and bioenergy.

Chief executive Shaun Kingsbury said the bank’s role went “well beyond that of a traditional investor”.

“We want to do more to maximise our green impact,” he said. “We plan to extend our reach into new markets like community-scale renewables.”

The bank added that its proposed wind farm equity fund would allow developers to refinance and noted the “compelling opportunity” for investors to enjoy inflation-linked returns.

“These attributes can be well matched to the needs of long-term infrastructure investors such as sovereign wealth funds and pension funds,” it said in a statement.

The GIB has so far not been required to gain regulatory approval for its activities from the Financial Conduct Authority (FCA), but it said the new subsidiary was now seeking approval to become a regulated fund manager.

A spokeswoman for the bank said no appointments for the new fund manager had been confirmed.

However, she said it was expected that several of the GIB’s current employees would move over to new roles at the subsidiary.

The bank, launched in 2012, has so far invested £4.8bn in green energy projects, deploying £1.3bn of its £3.8bn in capital.

It is no stranger to the refinancing of wind farm projects and in late 2012 was part of a consortium of five banks to assist Dutch pension manager PGGM and the Ampere Equity Fund in the refinancing of a nearly 25% stake in a wind farm in the Irish sea.