DBS continues to break new ground in China as first Southeast Asian bank to leverage PBOC’s Carbon Emission Reduction Facility for issuance of green loan
Singapore, China.21 Aug 2024
Green loan issued to Envision Energy for a 100-megawatt wind power project to serve the national grid in Puyang, Henan
Project expected to generate 270 gigawatt hours of renewable energy and avoid an estimated 212,600 tonnes of carbon emissions
Singapore, China, 21 Aug 2024 - DBS, in partnership with Envision Energy, today announced an RMB 500 million (SGD 92 million) green loan facility to develop a 100-megawatt wind turbine farm in the Henan province, located in northeastern China. DBS China also served as the sole green finance advisor for this loan to ensure that the terms comply with the China-EU Common Ground Taxonomy.
When completed, the project is expected to generate about 270 gigawatt hours of renewable energy – enough to power 90,000 households and avoid 212,600 tonnes of carbon emissions annually.
The loan will be issued under the People's Bank of China’s (PBOC) Carbon Emission Reduction Facility and represents the first successful transaction in this programme by a Southeast Asian bank.
The landmark programme enables participating banks to offer low-cost loans to fund sustainable development projects in China across key sectors including clean energy, energy saving, environmental protection, and carbon emission reduction technologies. The programme helps to subsidise China’s transition efforts, with PBOC providing financial institutions with funds equal to 60% of a loan's principal at an annual interest rate of 1.75%. As at end-June 2024, participating banks have extended over RMB 547 billion (SGD 100 billion) in loans. DBS is the only Singapore bank to be selected by PBOC for the programme.
DBS China CEO Ginger Cheng said: "We are honoured to be able to leverage this Carbon Emission Reduction Facility by PBOC, enabling us to provide financial support for Envision Energy's wind power project in Puyang, Henan. This will help Envision Energy expand clean energy capacity, reduce carbon emissions, and contribute to the achievement of the 'dual carbon' goals. As a leader in green finance in the ASEAN region, DBS Bank will further leverage its capabilities to continue supporting green and low-carbon development, contributing to China's high-quality sustainable economic development."
Kelvin Wong, Head of Energy, Renewables and Infrastructure, Institutional Banking Group, DBS, said: “The energy sector accounts for almost 90% of China’s greenhouse gas emissions. To achieve the nation’s carbon neutrality goal by 2060, the energy sector will need to undergo a rapid and deep transformation. DBS is proud to support Envision Energy, which has made a name for itself in the wind energy space, take a further step in that direction. With this carbon emission reduction support tool, the cost of capital for green projects is significantly reduced, making DBS a preferred partner for businesses seeking to invest in sustainable initiatives. As the first bank in Southeast Asia to transact under this PBOC programme, we are breaking new ground for sustainable finance in the region. We will continue to deepen our green finance toolkit, explore more innovative products and services, and expand our suite of capabilities to accelerate our clients’ green transformation.”
DBS’ ability to offer this loan under the PBOC programme is part of the suite of solutions that DBS China has developed to support mainland enterprises in their sustainability journeys, alongside tools like panda bonds and green Accounts Receivable Purchase (ARP) solutions. In 2023, the bank was the joint lead underwriter for RMB 16.5 billion (SGD 3.1 billion) of panda bonds[1] issued in the China Interbank Bond Market, accounting for more than 10% of the record RMB 140 billion market that year. It also underwrote the first green financial bond issued by a foreign bank in China.
Sustainability continues to be a growing area of interest in China, with DBS China’s green financing portfolio growing 62% year-on-year as at end 2023. This underscores the bank’s commitment to accelerating green finance and sustainable development in the market.
About DBS
DBS is a leading financial services group in Asia with a presence in 19 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world.
Recognised for its global leadership, DBS has been named “World’s Best Bank” by Global Finance, “World’s Best Bank” by Euromoney and “Global Bank of the Year” by The Banker. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney and the world’s “Most Innovative in Digital Banking” by The Banker. In addition, DBS has been accorded the “Safest Bank in Asia“ award by Global Finance for 15 consecutive years from 2009 to 2023.
DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets.
DBS is committed to building lasting relationships with customers, as it banks the Asian way. Through the DBS Foundation, the bank creates impact beyond banking by supporting businesses for impact: enterprises with a double bottom-line of profit and social and/or environmental impact. DBS Foundation also gives back to society in various ways, including equipping underserved communities with future-ready skills and helping them to build food resilience.
With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. For more information, please visit www.dbs.com.
When completed, the project is expected to generate about 270 gigawatt hours of renewable energy – enough to power 90,000 households and avoid 212,600 tonnes of carbon emissions annually.
The loan will be issued under the People's Bank of China’s (PBOC) Carbon Emission Reduction Facility and represents the first successful transaction in this programme by a Southeast Asian bank.
The landmark programme enables participating banks to offer low-cost loans to fund sustainable development projects in China across key sectors including clean energy, energy saving, environmental protection, and carbon emission reduction technologies. The programme helps to subsidise China’s transition efforts, with PBOC providing financial institutions with funds equal to 60% of a loan's principal at an annual interest rate of 1.75%. As at end-June 2024, participating banks have extended over RMB 547 billion (SGD 100 billion) in loans. DBS is the only Singapore bank to be selected by PBOC for the programme.
DBS China CEO Ginger Cheng said: "We are honoured to be able to leverage this Carbon Emission Reduction Facility by PBOC, enabling us to provide financial support for Envision Energy's wind power project in Puyang, Henan. This will help Envision Energy expand clean energy capacity, reduce carbon emissions, and contribute to the achievement of the 'dual carbon' goals. As a leader in green finance in the ASEAN region, DBS Bank will further leverage its capabilities to continue supporting green and low-carbon development, contributing to China's high-quality sustainable economic development."
Kelvin Wong, Head of Energy, Renewables and Infrastructure, Institutional Banking Group, DBS, said: “The energy sector accounts for almost 90% of China’s greenhouse gas emissions. To achieve the nation’s carbon neutrality goal by 2060, the energy sector will need to undergo a rapid and deep transformation. DBS is proud to support Envision Energy, which has made a name for itself in the wind energy space, take a further step in that direction. With this carbon emission reduction support tool, the cost of capital for green projects is significantly reduced, making DBS a preferred partner for businesses seeking to invest in sustainable initiatives. As the first bank in Southeast Asia to transact under this PBOC programme, we are breaking new ground for sustainable finance in the region. We will continue to deepen our green finance toolkit, explore more innovative products and services, and expand our suite of capabilities to accelerate our clients’ green transformation.”
DBS’ ability to offer this loan under the PBOC programme is part of the suite of solutions that DBS China has developed to support mainland enterprises in their sustainability journeys, alongside tools like panda bonds and green Accounts Receivable Purchase (ARP) solutions. In 2023, the bank was the joint lead underwriter for RMB 16.5 billion (SGD 3.1 billion) of panda bonds[1] issued in the China Interbank Bond Market, accounting for more than 10% of the record RMB 140 billion market that year. It also underwrote the first green financial bond issued by a foreign bank in China.
Sustainability continues to be a growing area of interest in China, with DBS China’s green financing portfolio growing 62% year-on-year as at end 2023. This underscores the bank’s commitment to accelerating green finance and sustainable development in the market.
[1] Panda bonds are a common term for renminbi-denominated debt issued in China’s onshore market by non-Chinese companies, governments and organisations.
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About DBS
DBS is a leading financial services group in Asia with a presence in 19 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world.
Recognised for its global leadership, DBS has been named “World’s Best Bank” by Global Finance, “World’s Best Bank” by Euromoney and “Global Bank of the Year” by The Banker. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney and the world’s “Most Innovative in Digital Banking” by The Banker. In addition, DBS has been accorded the “Safest Bank in Asia“ award by Global Finance for 15 consecutive years from 2009 to 2023.
DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets.
DBS is committed to building lasting relationships with customers, as it banks the Asian way. Through the DBS Foundation, the bank creates impact beyond banking by supporting businesses for impact: enterprises with a double bottom-line of profit and social and/or environmental impact. DBS Foundation also gives back to society in various ways, including equipping underserved communities with future-ready skills and helping them to build food resilience.
With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. For more information, please visit www.dbs.com.