KUALA LUMPUR (Oct 9): Malaysian banks are taking on Financial institution Negara Malaysia’s problem to fight local weather change with the adoption of a accountable lending coverage in addition to educating their retail and enterprise banking prospects on sustainability.
Certainly one of Asia’s largest funding banks, CIMB Group Holdings Bhd, stated it has launched varied sustainability-linked loans inside the final 12 months, in addition to issued a bond value RM2.85 billion to fund initiatives associated to the United Nations’ Sustainable Improvement Objectives (SDGs), after organising its Sustainability Division in October final 12 months.
CIMB has additionally joined a coalition of 130 international banks with a mixed asset of over US$47 trillion to decide to align their enterprise with the SDGs and the Paris Settlement on Local weather Change.
“We have now additionally put in place two group-wide insurance policies – one on total sustainability coverage, whereas the opposite is on taking a look at environmental and social dangers in our enterprise lending,” group chief govt officer Tengku Datuk Seri Zafrul Aziz informed Bernama.
On the retail banking entrance, he stated CIMB would supply a diminished rate of interest for purchasers who buy extra energy-efficient vehicles and homes to encourage them to make extra sustainable choices.
On the enterprise banking entrance, the financial institution is actively speaking to purchasers about sustainability-linked loans, the place it might give purchasers a tiered low cost in the event that they meet pre-agreed sustainability targets on an annual foundation.
In the meantime, Malayan Banking Bhd (Maybank) established a Accountable Lending Guideline in 2015 to handle environmental, social and governance (ESG) dangers, which was later expanded right into a extra complete ESG Threat Administration Framework and subsequently endorsed as an organization coverage in 2018.
Group president/chief govt officer Datuk Abdul Farid Alias stated the coverage has been built-in into the financial institution’s day-to-day choices in relation to financing practices.
“Following this, we have now developed Threat Acceptance Standards (RAC) for recognized excessive ESG threat reminiscent of Oil Palm, Forestry & Logging, Oil & Fuel and Mining & Quarrying. Extra RACs will progressively come on-stream, additional strengthening our dedication to accountable lending.
“Not solely can we monitor our purchasers’ practices, however we additionally inform them that we’ll solely lend our help to those that are within the strategy of implementing or have already adopted sustainable practices,” he added.