CBIRC Shenzhen Office proposed to explore differentiated regulatory policies for green finance such as capital occupation, regulatory assessment, tolerance of non-performance, and other measures to further encourage financial institutions to innovate in green finance, as reported by Caixin on May 29. For instance, Shenzhen Office will encourage insurance and trust institutions to invest in green industrial investment funds, and coordinate policy-based financing guarantee institutions to strengthen credit enhancement and risk sharing in green finance fields. In addition, the Shenzhen authority will consider transforming the financial subsidy model from low-carbon and environmental protection subsidies to insurance premium subsidies.
Shenzhen is one of the first branches of innovation demonstration zones for implementing the 2030 Agenda for Sustainable Development approved by State Council, as well as the first batch of zero-waste city pilot program. In November 2020, the city released its green finance regulation, taking the lead in green finance legislation at local levels in the country. As of the end of 2020, the green credit balance of banking institutions in the jurisdiction reached RMB348bn, an increase of 16.8% YoY, which was 2.6% higher than the growth rate of loans, according to CBIRC Shenzhen Office. Moreover, Shenzhen has established a multi-dimensional, full-coverage statistical system with regional characteristics, covering all on-balance sheet and off-balance sheet subjects for financing green industries and all credit financial institutions.
At the national level, Chinese financial regulators are still improving the top-level design of green finance. PBoC will increase its support for green finance through various channels such as commercial bank ratings, deposit insurance premium rates, and macro-prudential assessment frameworks, said PBoC Governor Yi Gang in April. In the meantime, CBIRC’s local offices across the country focus on improving the green financial work system. For instance, with Tibet’s geographical advantages in clean energy resources, CBIRC Tibet Office established a set of clean energy projects and enterprises with more preferential loans. CBIRC Fujian Office launched the first national ecological civilization zone, focusing on green finance reform and innovation.