Malayan Banking Bhd (Maybank) , Malaysia’s largest bank by assets, said on July 19 to implement a USD11.88bn sustainable financing framework this year, as reported by CNA on the same day. Through the scheme, the bank will increase the scale of green and sustainable bonds or sukuk and financing for green projects, ESG thematic funds, and else.

This is another sustainable finance related move by Maybank, following the announcement in May that it would stop funding new coal activities and would no longer participate in tree cutting projects. Meanwhile, its president Abdul Farid Alias stated that the bank would collaborate with existing borrowers in the medium- or long-term diversification of a sustainable renewable energy mix. Maybank has a strong focus on ESG aspects of the program and has opened the Green Technology Finance Scheme (GTFS) since 2010. The government offered a 60% financing guarantee for this project. In response to Malaysia’s legal and commitments of reducing 45% carbon emissions in 2030 for the Paris Agreement, Maybank is committed to being carbon neutral by 2050.

Starting in 2019, many major Asia-Pacific financial institutions are exiting coal financing and are in favor of sustainable energy, green bonds, and other investments. These include CIMB Group Holdings Bhd, one of Maybank’s competitors, Industrial and Commercial Bank of China (ICBC) , and three of Australia’s big four banks. Many banks have also launched sustainable finance frameworks. For instance, China Construction Bank launched its Green, Social and Sustainable Development Bond Framework in March 2019, aiming to conduct sustainable development finance projects that are in line with environmental protection and social security. Agricultural Development Bank of China (ADBC) and Development Bank of Singapore (DBS) had launched similar projects as well.

Sources:

https://www.channelnewsasia.com/news/business/malaysia-s-maybank-to-implement-us-11-9-billion-sustainable-finance-framework-15249462

https://www.reuters.com/business/sustainable-business/malaysias-maybank-implement-119-bln-sustainable-finance-framework-this-year-2021-07-19/

https://www.kitco.com/news/2021-05-06/Malaysia-s-Maybank-to-stop-financing-new-coal-activities.html

https://www.maybank2u.com.my/maybank2u/malaysia/en/business/financing/government_aided/business/green_technology_financing_scheme.page?

https://www.ft.com/content/8b8a231a-e6e0-4558-b411-93174c001415

https://www.scmp.com/news/china/article/3137137/chinese-bank-icbcs-coal-exit-power-move-greener-belt-and-road

http://www1.ccb.com/cn/investor/bondv3/20190331_1553963063.html

http://www.adbc.com.cn/n60/n61/c26585/part/12329.pdf

https://www.dbs.com/hongkong/newsroom/DBS_launches_worlds_first_sustainable_and_transition_finance_framework_and_taxonomy_to_help_clients_advance_on_sustainability_agenda_CN