Green Loan、Sustainability Linked Loan
Bank of China (Hong Kong) Limited (“BOCHK”), continually provides diversified financial services, proactively promotes green and sustainability development, develops various green finance products and services. We collaborate with all the stakeholders in the society to combat the challenge of climate and environmental change by promoting the economic growth with a low carbon consumption and sustainably change.
BOCHK encourages corporates to achieve their goals on sustainable development by providing green loan and sustainability linked loan financing service for eligible environmentally sustainable green project, or for corporate funding to improve its sustainability performance targets.
Why choose green finance
- Improve the brand value: thorough green financing, corporate branding on social sustainability and environmental protection would be positively established.
- Broaden the range of potential investors: attract investors that value sustainability and social responsibility.
- Encourage corporate transformation, accelerate the development of green finance: maintain business sustainability, develop new market, reduce the risk and impact on climate change, promote the sustainable long-term growth and profitability.
- Satisfied and comply with governance and policy
Green Loan、Sustainability Linked Loan
Target customer: corporates from all industries
Application requirements: related loan application should fulfill the principle of green loan or Sustainability Linked Loan
Loan type: term loan, revolving loan
Green Loan
Green loans are any type of loan instrument made available exclusively to finance or re-finance, in whole or in part, new and/or existing eligible Green Projects. Green loans must align with the four core components of the Green Loan Principles1.
Referring to Green Loan Principles, the Indicative Categories of Eligibility for Green Projects, include, but are not limited to:
| Category | Example | |
| 1 | renewable energy | including production, transmission, appliances and products |
| 2 | energy efficiency | such as in new and refurbished buildings, energy storage, district heating, smart grids, appliances and products |
| 3 | pollution prevention and control | including reduction of air emissions, greenhouse gas control, soil remediation, waste prevention, waste reduction, waste recycling and energy/emission-efficient waste to energy |
| 4 | environmentally sustainable management of living natural resources and land use | including environmentally sustainable agriculture, environmentally sustainable animal husbandry; climate smart farm inputs such as biological crop protection or drip-irrigation; environmentally sustainable fishery and aquaculture, environmentally-sustainable forestry, including afforestation and reforestation, and preservation or restoration of natural landscapes |
| 5 | terrestrial and aquatic biodiversity conservation | including the protection of coastal, marine and watershed environments |
| 6 | clean transportation | such as electric, hybrid, public, rail, non-motorised, multi-modal transportation, infrastructure for clean energy vehicles and reduction of harmful emissions |
| 7 | sustainable water and wastewater management | including sustainable infrastructure for clean and/or drinking water, wastewater treatment, sustainable urban drainage systems and river training and other forms of flooding mitigation |
| 8 | climate change adaptation | including information support systems, such as climate observation and early warning systems |
| 9 | eco-efficient and/or circular economy adapted products, production technologies and processes | such as development and introduction of environmentally sustainable products, with an eco-label or environmental certification, resource-efficient packaging and distribution |
| 10 | green buildings | green buildings which meet regional, national or internationally recognised standards or certifications |
1 Green Loan Principle (jointly published by ICMA、APLMA & LSTA) Feb 2023
Sustainability Linked Loan
Sustainability Linked Loan
Based on Sustainability Linked Loan Principles2, sustainability linked loans are any types of loan instruments and/or contingent facilities (such as bonding lines, guarantee lines or letters of credit) which incentivise the corporate’s achievement of ambitious, predetermined sustainability performance objectives. The corporate’s sustainability performance is measured using predefined sustainability performance targets (SPTs), as measured by predefined key performance indicators (KPIs), which may comprise or include external ratings and/or equivalent metrics, and which measure improvements in the corporate’s sustainability profile.
The corporate of a sustainability linked loan should clearly communicate to its bank its rationale for the selection of its KPI(s) (i.e. relevance, materiality) and the motivation for the SPT(s) (i.e. ambition level, consistency with overall sustainability objectives as set out in its sustainability strategy, benchmarking approach and how the corporate intends to reach such SPTs). Corporates are encouraged to position this information within the context of their overarching objectives, strategy, policy and/or processes relating to sustainability. Corporates are also encouraged to disclose to banks any sustainability standards or certifications to which they are seeking to conform.
Referring to Sustainability Linked Loan Principles, the indicative categories of KPIs , include, but are not limited to :
Environmental
| Category | Example | |
| 1 | Energy efficiency |
Improvements in the energy efficiency rating of buildings
and/or machinery owned or leased by the borrower. |
| 2 | Greenhouse gas emissions | Reductions in greenhouse gas emissions in relation to products manufactured or sold by the borrower or to the production or manufacturing cycle. |
| 3 | Waste Disposal | Reductions in liquid and solid waste disposals in relation to products manufactured by the borrower or to the production or manufacturing cycle. |
| 4 | Renewable energy |
Increases in the amount of renewable energy generated or used by the borrower. |
| 5 | Water consumption | Water savings made by the borrower. |
| 6 | Sustainable sourcing | Increases in the use of verified sustainable raw materials/supplies. |
| 7 | Circular economy | Increases in recycling rates or use of recycled raw materials / supplies. Achievement of zero waste in production plants. |
| 8 | Sustainable farming and food | Improvements in sourcing/producing sustainable products and/or quality products (using appropriate labels or certifications). |
| 9 | Biodiversity | Improvements in conservation and protection of biodiversity, and contribution to biodiversity. |
| 10 | Global ESG assessment | Improvements in the borrower’s ESG rating and/or achievement of a recognised ESG certification. |
Social
| Category | Example | |
| 1 | Affordable housing | Increases in the number of affordable housing units developed by the borrower. |
| 2 | Employee health and safety | Improvements in the borrower’s “ability to create and maintain a safe and healthy workplace environmental that is free of injuries, fatalities and illness (both chronic and acute). It is traditionally accomplished through implementing safety management plans, developing training requirements for employees and contractors, and conducting regular audits of their own practices as well as those of their subcontractors. The category further captures how companies ensure physical and mental health of workforce through technology, training, corporate culture, regulatory compliance, monitoring and testing, and personal protective equipment.”
|
| 3 | Employee engagement, diversity and inclusion | Improvement in specific long-term goals relating to improvements in diversity and training and further education. |
| 4 | Employee training | Increase training hours for employees. |
2 Sustainability Linked Loan Principles (jointly published by APLMA & LSTA) Feb 2023
Green Finance Advisory
Bank of China (Hong Kong) Limited (“BOCHK”), proactively involves into the promotion and development of green finance advisory. BOCHK supports corporates to achieve their green transitions by assisting on the development of the tailor-made green finance framework.
Green financial market undergoes blooming development under the promotion of global policymakers and sustainability risk management, banks and investors tends to invest more on green and sustainability related projects.
BOCHK, as a corporate green advisor, provides support to corporate on developing and promoting sustainable business model and assists corporate to design green finance framework.
We assist corporate to select green project, setup the guideline on the use of funding, and design the green loan framework under and comply with the international standards such as ‘Green Loan Principles’ , ‘Green Bond Principles’, as well as coordinate with the application of certification from the third party certifiers. The certification is useful for corporate financing on green projects.
General Terms:
The above products, services and offers are subject to the relevant terms.
For further enquiry, please contact your relationship manager.
Reminder: To borrow or not to borrow? Borrow only if you can repay!
Terms and conditions：
Corporate Customer shall provide a green assessment or certification by a qualified assessment organization. BOCHK will review and update the list of qualified assessment organisations at any time without prior notice. BOCHK reserves the sole discretion about the Offer.
Corporate Customer shall provide BOCHK with the green assessment or certification before drawdown of the term loan.
The above products, services and promotional offers are subject to the relevant terms and conditions of BOCHK. For more details, please contact BOCHK staff. BOCHK reserves the right to amend, suspend or terminate the above products, services and offers, and amend their relevant terms and conditions at any time at its absolute discretion. In case of any dispute, the decision of BOCHK shall be final.
BOCHK reserves the right to approve and reject the loan application at its absolute discretion. The actual loan amount, interest rate, handling fee and applicable terms and conditions are subject to BOCHK final approval. Should there be any discrepancy between the English and Chinese versions of this promotion material, the Chinese version shall prevail.
For further enquiry, please contact your relationship manager.
