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Industrial Bank and IFC Collaborate to Expand Energy Efficiency Loans and Cut Greenhouse Gas Emissions in China: IFC to Support $210 Million Risk-sharing Coverage for Industrial Bank’s Energy Efficiency Loans
In Beijing:
Helen Ni
Telephone: + 86 10 5860 3262
E-mail: HNi@ifc.org
In Hong Kong:
Andrew Mak
Telephone: +852 2509 8110
E-mail: AMak@ifc.org
Beijing, February 25, 2008—Industrial
Bank, a pioneer in providing energy efficiency financing in China, and
IFC, a member of the World Bank Group, today signed a cooperation agreement
to deepen their collaboration in supporting energy saving and greenhouse
gas emission reductions in China. This is the second phase of the IFC China
Utility-based Energy Efficiency Finance Program.
Under the agreement, IFC will provide
a $100 million risk-sharing facility to Industrial Bank that will help
the bank extend 1.5 billion Chinese renminbi ($210 million) in energy efficiency
loans. This initiative is expected to help reduce 5 million tons of carbon
dioxide emissions a year, the equivalent of replacing ten 100-megawatt
coal-fired power plants in China.
“As a major commercial bank in China, we attach great importance to corporate
social responsibility. We are proud to offer a market-based financing model
to help the country save energy and improve its environment,” said Industrial
Bank’s President Li Renjie. “This is another step in our strategy of
becoming the leading bank in environmental finance, building our business
while serving the communities in which we operate. We greatly appreciate
the strong partnership and cooperation IFC has established with us. Looking
forward, we will increase our efforts in promoting the program, continue
to introduce diversified service models, create customer value, as well
as play a greater role in contributing to China’s growing need of promoting
energy efficiency and greenhouse gas emissions reduction.”
While in Beijing to sign the agreement,
which was also witnessed by officials from the China Banking Regulatory
Commission, the Ministry of Finance, and the State Administration of Environment
Protection, IFC Vice President for Financial Markets, Funds, and Africa
Jyrki Koskelo said IFC’s facility for Industrial Bank demonstrates the
strategic partnership that the two institutions have established. He added
that Industrial Bank is at the forefront of banks in Asia that understand
the attractive opportunity that climate change finance presents to achieve
competitive advantage.
“President Li and his senior management team have a far-sighted view of
the future of banking in China with a focus on prudent management, introduction
of new products, and execution of strategy,” Koskelo said. “We expect
to broaden our cooperation in a whole range of services that increase access
to finance, improve services to families, and support small and medium
enterprises.”
The two parties have made significant
progress in their cooperation on the first phase of the program, which
was launched in 2006. In that phase, IFC provided a risk-sharing facility
of up to $25 million for Industrial Bank’s “green” loans. In turn, the
bank has financed 46 energy efficiency and greenhouse gas emissions reduction
projects, for a total loan amount of 900 million Chinese renminbi ($126
million). The majority of these loans are to small and medium enterprises
that are implementing energy efficiency projects such as industrial boiler
retrofitting, wasted heat recovery, co- and tri-generation projects for
district heating, power saving, and optimization of industrial energy uses.
Implementation of these projects are expected to reduce carbon dioxide
emissions by more than 3.5 million tons a year, the equivalent of emissions
from all 70,000 taxis currently running in Beijing for three years.
About Industrial Bank
Founded in 1988, Industrial Bank is a national joint stock bank in China
and operates more than 400 offices in 41 branches and with over 10,000
employees. The bank is listed on Shanghai Stock Exchange (Stock Code: 601166)
with total registered capital of RMB 5 billion. Total assets as of
September 30, 2007 were RMB 857.615 billions, and relevant shareholders’
equity was RMB 36.996 billion. Industrial Bank realized net profit of RMB
6.024 billion during January and September of 2007. For more information,
visit www.cib.com.cn.
About IFC
IFC, a member of the World Bank Group, fosters sustainable economic growth
in developing countries by financing private sector investment, mobilizing
private capital in local and international financial markets, and providing
advisory and risk mitigation services to businesses and governments. IFC’s
vision is that people should have the opportunity to escape poverty and
improve their lives. In FY07, IFC committed $8.2 billion and mobilized
an additional $3.9 billion through syndications and structured finance
for 299 investments in 69 developing countries. IFC also provided advisory
services in 97 countries. For more information, please visit www.ifc.org.
Funded by IFC, the Global Environment Facility, and the Finnish and Norwegian
governments, the IFC China Utility-based Energy Efficiency Program was
designed by IFC at the request of China’s Ministry of Finance. The
goal is to lower emissions of greenhouse gases by creating a sustainable
financing mechanism for investment in energy efficiency, clean energy,
and emissions reduction projects. IFC offers Chinese commercial banks
a facility whereby IFC shares part of the risk for all loans within the
energy efficiency portfolio. IFC also provides advisory services on marketing,
engineering, project development, and equipment financing services to banks,
project developers, and suppliers of energy efficiency products and services.
For more information, visit www.ifc.org/chuee.
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