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Thursday, June 30, 2016, 11:03

Banking sector takes greener approach

By Jiang Xueqing

China's banking industry has improved its policy framework to support the development of an environment-friendly, circular and low-carbon economy, said a corporate social responsibility report released by the China Banking Association on Friday.

By the end of 2015, Chinese banking institutions recorded that the balance of their green credit reached 8.08 trillion yuan (US$1.22 trillion), of which 21 major banks extended 7.01 trillion yuan, rising 16.42 percent from the beginning of the year.

Projects supported by the loans are expected to save 221 million tons of standard coal and 756 million tons of water, reduce 3.55 million tons of chemical oxygen demand, and cut polluting emissions, including 550 million tons of carbon dioxide, 4.85 million tons of sulfur dioxide, 2.27 million tons of nitrogen oxide and 384,300 tons of ammonia nitrogen, according to the report.

Yang Zaiping, executive vice-president of the China Banking Association, said: "In 2015, banking institutions made green credit guidelines suitable for their own growth, conducted training on green finance, tightened their control of lending to high polluting, high energy consuming and overcapacity industries, and gave a strong support to the development of clean energy sources, such as wind power, hydropower and photovoltaic power."

As of the end of last year, 2.32 trillion yuan of bank credit supported 23,100 energy conservation and environment protection projects.

China Merchants Bank Co Ltd and China Cinda Asset Management Co Ltd jointly established a 2-billion-yuan fund, of which the China Merchants invested 1.5 billion yuan, that will help build a 250-megawatt photovoltaic power plant with an annual output of 350 million kilowatt-hours, the equivalent of power consumed by 360,000 families a year.

Industrial Bank Co Ltd, a mid-sized Chinese commercial lender, extended 100 million yuan of loans to a company for the acquisition of new energy vehicles to develop timeshare rental services for local residents. By the end of 2015, the Industrial Bank Financial Leasing Co Ltd lent a total of 54.38 billion yuan to 146 projects in the field of green leasing.

Last year, Agricultural Bank of China Ltd, the country's third largest lender by assets, issued a US$995 million dual-currency green bond in London - the first green bond from a Chinese bank to fund environment-friendly projects.

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